Megvii continues on path to Shanghai listing

Chinese artificial intelligence company Megvii Technology has taken its first step to listing on the Shanghai Stock Exchange's Science and Technology Innovation Board, or the STAR Market, The Paper reported.

Megvii signed an agreement with CITIC Securities last September, under which the latter will guide the former to issue Chinese depositary receipts on the STAR Market, according to the website of the China Securities Regulatory Commission.

Megvii filed for an initial public offering in Hong Kong in August 2019. According to the prospectus, the company registered revenue of 67.8 million yuan in 2016, 313.2 million in 2017 and 1.43 billion in 2018.

During the first half of 2019, its revenue rose 210.3 percent year-on-year to 949 million yuan. At the same time, it posted 5.2 billion yuan in net losses. The company attributed the losses to one-off items, such as share-based compensation payments and continuous R&D investment.

However, Megvii's road to a Hong Kong IPO has not been smooth. Due to uncertainties in international trade and purchase, the Hong Kong Stock Exchange required the company to provide more information. Last June, media reported Megvii's IPO progress had stopped.

In response to the reports, the company said Shanghai's STAR Market supports and encourages enterprises with "hard technology" to go public, and it's a good opportunity for the development of Chinese technological companies. Megvii is actively considering this plan.

Yin Qi, co-founder and CEO of Megvii, also said the company didn't stop its IPO plan and will advance it at a better time.

Founded in 2011 by three Tsinghua University graduates, Megvii's core technology and business is facial recognition, and is best known for Face++, an open cloud-based visual platform.

Megvii is widely recognized as one of the top four computer vision startups in China, along with SenseTime, CloudWalk and Yitu. At present, the four companies are all preparing for an IPO on Shanghai's STAR Market.