NeoTV Group Limited, China’s esports content provider and events operator, has filed for a $55 million US initial public offering, aiming to beat its larger Chinese e-sports rival Tencent-Backed VSPO to market.
The compamy plans to list ordinary shares on the tech-dominated Nasdaq under the ticker symbol "NTV".
China is one of the world’s largest e-sports markets despite a tough regulatory environment for gaming. NeoTV’s prospectus cites third-party research estimating the Asian giant’s e-sports industry at 127 billion yuan ($18 billion) in 2021, roughly double the 60 billion yuan four years earlier in 2017.
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In 2021, Beijing introduced rules that limits the amount of time under 18s can play online video games — to up to three hours per week. Regulators also froze approvals of new titles for a few months. The impact was felt immediately by China’s biggest gaming companies like NetEase and Tencent.
However, despite China limiting the amount of time kids play online games, the e-sports market has held up well over the long term. According to the NeoTV prospectus, the e-sports livestreaming business grew six-fold to 18.5 billion yuan in 2021 from 3 billion yuan in 2017.
NeoTV is dominated by its founder and chairman, Lin Yuxin, who currently owns 66% of its shares. NeoTV’s iniial public offering (IPO) is being underwritten by investment bank, Prime Number Capital.
Significantly, Chinese startups are raising millions of dollars in US stock market listings again, after a dry spell in the once-hot market. The Hesai Group, which sells “lidar” tech for self-driving cars, listed on the Nasdaq in earlier in February this year. It raised $190 million in its IPO, more than its initial plans.
Contact the author Uttara Choudhury at uttara@proactiveinvestors.com
Follow her on Twitter: @UttaraProactive