Amid China's crackdown on tech giants, Tencent-backed (TCEHY) and Goldman Sachs-advised (GS) Tuhu, a Chinese online-to-offline car-services platform, is moving its planned US IPO to Hong Kong.

Tuhu, one of China's largest car maintenance and service startups, has applied for a review of the prospectus it reportedly filed earlier with the Hong Kong Stock Exchange, an exchange filing shows.

Photo by Ezreal Zhang on Unsplash

Goldman Sachs, China International Capital Corporation (CICC), Merrill Lynch and UBS Group are the firm's underwriters.

According to the prospectus, Tuhu's overall income grew 24.3% from CNY 7 billion (USD 1.10 billion) in 2019 to CNY 8.8 billion in 2020. The firm's revenue in the nine months ending September 30, 2020 stood at CNY 6 billion and rose to CNY 8.4 billion for the same period of this year, up 41.8% year on year.

As of 2019 and 2020, the company's gross profit was CNY 523.4 million and CNY 1.1 billion. Meanwhile, its gross profit totaled CNY 795.4 million and CNY 1.3 billion in the first nine months ending September 30 of 2020 and 2021.

Tuhu has been riding high on a boom in China's after-sales car service market and a surge in private car numbers. By the end of last year, China had a total of 395 million cars on the roads, up 6.32% over the previous year.

The Shanghai-based car service operator started out in 2011 by offering repairs, tire change and other car-related services and pricing them at a generally lower level than official dealerships'.

It has since engaged in an online-to-offline business model, where users can place orders on its app and drive to designated businesses to receive the service.

Its app and website now boast a user base of 72.8 million. In the 12 months preceding September 30, 2021, Tuhu logged 13.9 million paying users, an increase of 35.6% from the same period a year earlier.

According to a report by China Insights Consultancy, a business intelligence service provider, Tuhu's monthly active users topped 10 million in September last year.

The platform partners with an army of merchants scattered across China and aims to standardize their services in a notoriously fragmented market. 

It has covered more than 300 cities across China through a vast network of self-run stores, franchises and partner outlets.

As of September 30, 2021, Tuhu had 202 self-operated stores and 3,167 franchises. Moreover, it had 33,223 partner outlets nationwide.

Prior to the IPO, the company's founder and CEO Chen Min holds a stake of 11.76%, while its co-founder Hu Xiaodong possesses 3.22%.

Among Tuhu's financial backers, Tencent is the largest institutional investor with 19.41% of the shares. The stakes held by the other shareholders including Joy Capital, Sequoia China, FountainVest, Baidu and CICC come in at 8.98%, 7.56%, 5.46%, 2% and 2.32%, respectively.