Speculations over the IPO launch of Tencent Music, the music arm of Chinese internet conglomerate Tencent Holdings, seems to be over.
The company is expected to submit an IPO filing to the US Securities and Exchange Commission in September. The final launch of IPO will be at a valuation between $29 billion and $31 billion and is slated to be in October, according to Technode.
Tencent Holdings holds around 62.45 percent in the music company.
Tencent Music owns music apps such as QQ Music, Kugou and Kuwo apps, which have a combined 600 million monthly active users. The apps provide a free-to-stream service and a subscription mode. And it controlled 78 per cent of China’s music streaming market in 2017.
Tencet Music competes with products from Alibaba Group Holding Ltd. and NetEase Inc.
In July 2016, Tencent announced a strategic merger with China Music Corporation to develop the digital music business in China and launched its music arm. The Chinese music streaming market forecast to reach 4.37 billion yuan ($664 million) of subscription revenue by 2018.
Meanwhile, the parent company Tencent has been affected by a sharp slump in shares. It is on a losing spree and has tumbled 25 per cent since January, erasing about $143 billion of market value. Last month alone, the company witnessed its stock down by 9.8 per cent. The loss of $143 billion is also the biggest wipeout of shareholder wealth worldwide.
Its year-on-year profit growth also slowed to 5.1 per cent in the second quarter, the weakest pace since 2012.
Music Inc grows in India
On the back of Reliance Jio launch, music streaming platforms have grown immensely in India. In February, Times Internet-owned Gaana scooped up $115 million fundraise from Tencent. It is one of the biggest online music streaming platforms which had over 50 million monthly active users with a staggering 92 million downloads in December last year.
Recently, Airtel’s owned Wynk claimed number 2 spot in music streaming segment with 75 million application downloads.
According to a recent report, music streaming app Saavn has recorded 3X surge in profit in the fiscal year ending December 2017. It has posted a revenue of Rs 45.9 crore in the FY17 (Jan to Dec), said RoC filings.