JD Logistics, Inc. is about to go public, and VC/PE, which took the lead in that year, reaped a return of US $3 billion in three years.

JD Logistics, Inc. will be listed on the main board of the Hong Kong Stock Exchange on May 28. JD Logistics, Inc. opened new share subscription on May 17. According to Futu Securities, JD Logistics, Inc. 's financing subscription reached HK $110.46 billion as of 17:40, with a margin multiple of 139.4 times.

According to the previous announcement, JD Logistics, Inc. plans to issue 609 million shares of IPO, of which 18.275 million shares will be sold in Hong Kong and 591 million shares will be sold internationally at a price of HK $39.36-HK $43.36 per share. The maximum amount of capital raised in front of Green shoes can reach HK $26.55 billion (about RMB 22 billion).

According to the upper limit of the offering price, JD Logistics, Inc. 's market capitalization will reach 264.1 billion Hong Kong dollars (US $34 billion) after listing. When JD Logistics, Inc. raised money independently at a valuation of $10 billion in 2018, the top PE netted more than $3 billion in just three years.

But JD Logistics, Inc. listed, of course, earned the most is Liu Qiangdong. According to the prospectus, as chairman of JD Logistics, Inc., the total value of JD Logistics, Inc. shares indirectly held by Liu Qiangdong is about HK $24 billion. In addition, in October last year, JD Logistics, Inc. 's board of directors also granted Liu Qiangdong an equity incentive of 99.19 million shares. in other words, Liu Qiangdong gave himself a "red envelope" of HK $4.3 billion.

From this point of view, Brother Dong really has to thank his 190000 courier brothers.

JD Logistics, Inc. went public, Brother Dong made a big profit of 28.1 billion.

According to the prospectus, Liu Qiangdong, founder of JD.com, is chairman and non-executive director of JD Logistics, Inc.. As of pre-listing, JD.com Group held 71.58 per cent of JD Logistics, Inc. through wholly-owned subsidiaries, while Liu Qiangdong owned 76.9 per cent of JD.com Group's voting rights and was JD Logistics, Inc. 's actual controller.

Liu Qiangdong currently holds 14% of the shares of JD.com Group. According to JD Logistics, Inc. 's offering price, the total value of JD Logistics, Inc. shares indirectly held by Liu Qiangdong after listing is HK $23.8 billion.

In addition, in October 2020, with the approval of the board of directors, JD Logistics, Inc. awarded Liu Qiangdong 99.19 million JD Logistics, Inc. shares at an exercise price of US $0.01. Based on the offering price of HK $43.36, the total value of the equity incentives is about HK $4.3 billion.

Brother Dong ate meat and didn't forget the "brothers" to drink soup. According to the prospectus, JD Logistics, Inc. awarded a total of 150 million shares to 40 Dong Jiangao, including Liu Qiangdong and CEO Yu Rui. Excluding Liu Qiangdong, 39 JD Logistics, Inc. executives each awarded 1.3 million shares, worth about HK $56.6 million.

In addition, JD Logistics, Inc. also awarded 130 million shares to a total of 4670 JD Logistics, Inc. employees and related persons, of which 291 people awarded more than 100000 shares, resulting in a gain of HK $8.7 million per person after listing; 1286 people awarded 20, 000-100000 shares, or HK $1.8 million per capita; and 3093 people awarded less than 20, 000 shares, per capita HK $260000.

How much did Sequoia and Hillhouse earn when JD Logistics, Inc. went public?

JD Logistics, Inc. spun off separate financing in 2018, when the VC/PE almost broke their heads in order to compete for the share of round A.

According to the prospectus, JD Logistics, Inc. raised a total of $2.5 billion in round A. As shown in the chart above, the total value of shares of round A shareholders after listing is about $5.58 billion. In just two years, Liu Qiangdong earned a net income of more than $3 billion for round A shareholders, with a net return of 123%.

Specifically, Hillhouse Capital and Easter Capital, which each invested $360 million in round A, each made a total return of more than $800m after listing.

The real controller of EasterCapital is Shi Shilin, who has a close relationship with Liu Qiangdong, who not only appeared on the list of directors of Jingdong Mathematical Science, but also controlled funds that participated in the early investments of a number of Jingdong listed companies, and was also a shareholder in Dongchen Investment, a private investment agency of the couple.

Sequoia Capital China's share ranked third in JD Logistics, Inc. 's round A financing. Sequoia invested US $170 million at that time, with a total return of about US $380 million. In addition, the total returns of China Life Insurance Company Limited Trust, Tianyi Capital, Tencent, China Development Finance, China Merchants Capital, China State-owned Enterprise Adjustment Fund, Carlyle Investment and Qianshan Capital are also more than 100 million US dollars.

In addition to the 11, 35 investment institutions have invested US $980 million in JD.com through Jingdong E-Commerce (Express) LLC, a Hong Kong-registered entity, earning a total return of US $2.2 billion.

Among the 35 institutions are traditional financial institutions such as Bank of China, ICBC, China Construction Bank, China Merchants, Ping an and Cathay Pacific Securities, as well as venture capital institutions such as Huaxing, Softbank Corp. China, Kai Cheng Capital founded by Chang Bin, former vice president of Capital Today, and even Yao Jinbo, founder of 58.com, and Chen Xiaohua, CEO of Swan.

It can be said that half of China's financial and investment circles have benefited from JD Logistics, Inc. 's listing. But whether the book income can be pocketed in the end depends on the attitude of the secondary market after the end of the half-year lock-up period, which brings us back to a question: is JD Logistics, Inc. worth so much money?

JD Logistics, Inc., is it worth 260 billion yuan?

According to the prospectus, JD Logistics, Inc. was founded in 2007 as the internal logistics department of JD.com Group. Relying on JD.com Mall, JD Logistics, Inc. provided services to more than 190000 enterprise customers in 2020, covering FMCG, clothing, home appliances, furniture, 3C, automotive and fresh industries.

JD Logistics, Inc. calls his model "integrated supply chain logistics". By the end of 2020, JD Logistics, Inc. had operated more than 900 warehouses in China and 32 "Asia one" large intelligent warehouses in 22 cities, with more than 190000 distribution personnel.

In 2018, 2019 and 2020, JD Logistics, Inc. 's income was 37.9 billion yuan, 49.8 billion yuan and 73.4 billion yuan respectively, and the net loss was 2.8 billion yuan, 2.2 billion yuan and 4 billion yuan respectively.

Here you can compare JD Logistics, Inc. 's market capitalization and market-to-sales ratio with those of Shunfeng and Dada.

Shunfeng currently has a market capitalization of 297 billion yuan, which is about 36 per cent higher than JD Logistics, Inc. (calculated according to the upper limit of the issue price). Its income in 2018, 2019 and 2020 is 90.9 billion yuan, 112.2 billion yuan and 153.9 billion yuan respectively, and its net profit is 4.46 billion yuan, 5.62 billion yuan and 6.93 billion yuan respectively. According to the market-to-sales ratio, JD Logistics, Inc. is about 0.5 times more expensive than Shunfeng.

As for Dada, another logistics company in the JD.com department. At present, the total market capitalization is 5.2 billion US dollars, and the income in the past three years is 1.92 billion yuan, 3.1 billion yuan and 5.74 billion yuan respectively. According to Dada's data, JD Logistics, Inc. 's market-to-sales ratio is only about half of that of Dada.

The attitude of cornerstone investors is also evident in whether JD Logistics, Inc. is expensive in the end. According to media reports, seven cornerstone investors have agreed to subscribe for HK $11.9 billion of JD Logistics, Inc. shares, including Softbank Corp., Temasek, Tiger Global Fund, China State-owned Enterprise Adjustment Fund and Chengtong Investment, Blackstone Group Inc, Matthews Fund and Oak Capital.