SenseTime, China's most oversized AI firm heads to Hong Kong IPO
Chinese artificial intelligence (AI) company SenseTime filed necessary documents to the Hong Kong Exchange to release the initial public offering papers. The company received the ISO26262 ASIL Automotive Safety Integrity Level-B (ASIL) certification issued by Authorities in German-based testing, verification, certification and audit company (SGS-TÜV).
SenseTime provides advanced and comprehensive AI-enabled products concerning automotive for its partners, which guarantees safety in products followed by world-leading standards. SenseTime is a global leading AI company that had limitations in the past, and at the moment, they are trying to get over the restriction through entering Hong Kong IPO.
According to a CNBC report, the company hesitated to disclose documents such as the size of the deal. Still, as China tightened its regularity towards technology, the matter is of high interest. Education, online entertainment and such sectors are in great moderation countrywide, and as a result, paperwork's need much affirms grip to establish in a broad market. 2019 was a challenging year for the company as the US blocked certain technologies. As a result of the restriction, the company was put on a restricted list.
As the company makes revenue through AI software regarding facial recognition and autonomous driving technology, it only makes sense that more revenue funnel will add up if big names on the market adapted developed technology. Because a large number of investors trusts those brands, and as a result, those investors are going to put a profound interest in a portion of the company itself. But the case is quite different here as SenseTime; they were not looking for an acquisition but a public offering in a broader market like Hong Kong. Hong Kong is one of the advanced countries regarding technology adaptation, which will benefit SenseTime to capture a larger market even though the US entity blocklist restricted the company a while back.
SenseTime acquired Automotive Software Process Improvement and Capacity Determination (ASPICE) along with CL1 and CL2 certifications in 2019, which is seen highly in the automotive and AI industry. Though pandemic pushed many businesses a few years back, artificial intelligence, machine learning and advance tech thrived. SenseTime opposed the ban thrown by the US and would work with authorities relevant to the field to resolve the issue. "If our subsidiary remains on the Entity List on a prolonged basis, we may not be able to compete effectively in certain business lines, and our business, results of operations and financial condition could be materially and adversely affected." – in a filing.
The US claimed SenseTime as "implicated in human rights violations and abuse in implementing China's campaign of repression, arbitrary mass detention, and high-technology surveillance." SenseTime said they were "deeply disappointed" at the US government's decision to blocklist the company, which slowed down investor moves. If the company remains banned for an extended period, it may not compete with other companies, restraining its abilities. But once the issues are fixed, these decisions can be lifted.
In recent months, China fulfilled its share of commitment toward the online sector, including tutoring, gaming, entertainment, and other significant entities. In that respect, SenseTime said, "We are subject to complex and evolving laws, regulations and government policies regarding privacy and data protection." The company is watching massive growth as in Q1 2021, it reported $255.4 million worth of revenue, up by 91.8% in just a year. Along with the profit, the company suffered a marginal loss of 3.71 billion yuan. China's regulatory crackdown is severe as it has wiped billions of tech stocks.