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Chinese IT Firm Hitek Global Sets IPO Target at $12.5 Million

Belinda Zhou 2019-06-08 05:05 AM

Hitek Global Inc., seeking a $12.5 million initial public offering in New York, has updated its financials in its latest filing and increased the proposed pricing of its shares.

In an amended prospectus, the Xiamen-based provider of IT services said that it expects to sell between 1.2 million and 2.5 million Class A shares at $5 each, up from $4 it targeted in a January filing.

Hitek operates two businesses: selling tax devices to small- and medium-sized businesses and providing hardware and software to large corporations. Chinese companies are required by law to purchase the Anti-counterfeiting Tax Control System tax devices, which Hitek is authorized to sell. 

“We expect to actively develop our system integration services and online service platform in the near future,” Hitek said in its prospectus. 

Looking forward, the company said its vision is to become a one-stop consulting destination for holistic IT and other business consulting services in China.

In a filing this week, Hitek updated its financial results. Its revenue in 2018 reached $6.9 million, nearly level with 2017. Net income increased to $2.2 million, or 20 cents per share, from $2.1 million profit, or 19 cents per ADS, in 2017. By Dec. 31, it reported $700,000 in cash and cash equivalents.

The proceeds from its IPO in New York will be used to help fund research and development, recruit additional employees, enhance its IT system, and for general working capital, Hitek said.

The company has no connection with Hitek Global, also in the IT business, with offices in Hyderabad, India, and Fort Wayne, Indiana, among other places.

Initially, Hitek sought to raise as much as $23 million in a November filing, then dropped the target to $10 million early this year. 

Boustead Securities is listed as the underwriter for the IPO. 

Hitek has applied to trade its shares under the symbol “HKIT."