SF Express to Raise HK$23 billion in Hong Kong

SF Express is planning an IPO in Hong Kong, as it seeks to raise up to HK$23.4 billion (US$3 billion). This will be the company’s second listing as it went public in Shenzhen through a backdoor listing in 2017.

The Shenzhen-based Fortune Global 500 company is the largest logistics operator in China and in Asia, and ranks fourth in the world, covering 207 countries and regions. Its fleets of 176,000 vehicles and 95 aircraft allow SF Express to have such extensive coverage. Its services include express, freight, on-demand, international and cold chain.

SF Express’ competency in express delivery is particularly strong and has earned a well-deserved reputation for highly reliable and efficient service in the Greater China market.

Its success is built on advanced technology, having invested heavily in information systems that enhance end-to-end express delivery procedures which span monitoring, tracking, inquiry and resource allocation.

It has developed the proprietary “SF Smart Brain”, a data-driven middle platform system, that enables effective management of highly complex operations across the company’s vast network, resulting to operational efficiencies and optimized costs. Its couriers are equipped with a set of proprietary and comprehensive technology tools to optimize delivery efficiency and ensure exceptional services.

Furthermore, its WeChat app “SF Pay”, allows customers to place order, set preferred delivery time, track shipment status, and appraise service quality of the courier, and settle payment easily.

Yet SF Express’ competitiveness is less evident in international markets where more established players – FedEx, UPS and DHL, dominate. Also Alibaba’s Cainiao threatens to blunt SF Express’ edge in the China market. Logistics is highly competitive and SF Express cannot afford to be complacent.

A healthy set of financials can be seen, its revenue increased by 29.1% from RMB207.2 billion in 2021 to RMB267.5 billion in 2022; EBITDA (non-IFRS measure) jumped by 33.1% from RMB21.8 billion in 2021 to RMB29.0 billion in 2022, while profit was RMB4.4 billion and RMB7.1 billion in 2021 and 2022, respectively.

With expansion in mind, SF Express aims to replicate its success in China and expand in selected high-growth Asian markets, while broadening its presence globally. It plans to enhance productivity, efficiency, international and cross-border capabilities as well as further invest in technology to build smart logistics solutions and networks.

Photo source: SF Express