Rarely giving interviews the founder and director Paul Durov VKontakte said that this year’s social network can carry out initial public offering. VKontakte maintains its status as the largest social network in Russia, but its financial results for last year can not be called outstanding. The estimates of the company look overpriced even compared to other companies of the IT sector.
In 2012, many companies in the IT sector promised to return to their plans for the IPO, which had to be postponed. Previously announced plans for such Facebook, did not give up the intention to stay on the stock exchange and Twitter. And here revived Russia’s largest social network VKontakte. Its founder and director Paul Durov in an interview with “Gazeta.ru,” said the company considers it possible to access to initial public offering in 2012 or 2013.
On the question of whether negotiations are conducted Mail.ru or any other Internet companies to sell their shares VKontakte, Durov said no, but said that shareholders VKontakte, possibly before the initial public sell a small fraction, about 3%, to increase the capitalization of the company before the IPO.
“Vedomosti” reported, citing a source at a large investment bank that wanted to VKontakte private placement last year and even had time to talk to several funds, but has not been suiting its proposals. At the same time as the newspaper, it’s a great desire to get control of the social network was the owner of 39.9% of its shares Mail.Ru Group. The company offered an assessment of all VKontakte to $ 3.75 billion last year, however, Paul Durov repeatedly made it clear Mail.ru, which will not allow the transfer of control over their child to a “trash-holding” (an expression of Paul Durova).
Judging by the price of $ 111.7 million, which was filled with an option to buy 7.44% stake VKontakte, the latter estimate is sotsseti $ 1.5 billion on financial performance can be judged only VKontakte reporting the same Mail.Ru Group. The annual report for 2010 the company provides the following financial results VKontakte. Learn more about cheap car insurance
Dynamic performance can not be considered outstanding: EBITDA and net profit grow obviously slower revenue. In its report for the 1st half of 2011 Mail.ru reported that included 39.9% of net profit VKontakte for the same period in the overall index posegmentnoy net profit of the group. At the same holding company had to make adjustments due to the strike on the acquisition of 7.44% VKontakte. The effect of this amendment for Mail.ru was $ 661 thousand, that is, indirectly, the net profit VKontakte for 6 months in 2011 is estimated at $ 8.9 million
VKontakte remains Russia’s largest social networks. According to TNS, in November 2011 VKontakte audience was 25 million users. Comscore agency believes that this figure is even higher – 35.9 million people. Paul himself Durov said that every page visited social network 33 million people, referring to the LiveInternet in January of this year.
However, a large audience does not mean good monetiziruemosti. For example, a social network audience Classmates less than VKontakte, but its profit margins look better. When receipts for 6 months in 2011 to $ 57.3 million of EBITDA and net income of $ Classmates 41.9 million and $ 31.5 million, giving a 73.2% return and 55.0%, respectively.
Consider the multipliers, which evaluated some of the IT sector.
Thus, when assessing a $ 1.5 billion VKontakte estimated at about 16 per annum and 52.8 the proceeds of annual EBITDA, which is too much even on the background characteristic of the IT sector increased values of multipliers. Yield a more recent reporting will be adjusted estimates, however, I would like to once again remind wishing to participate in the IPO VKontakte about the risks involved.
The positive economic situation in the IT sector contributes placements Internet companies to estimate the upper limit, and even above it, but then they are rapidly becoming cheaper paper, causing damage to investors. A similar situation was the same after the placement of Yandex, Mail.ru, and recent – Groupon. In this regard, if the score is higher than the VKontakte average for the sector, I recommend you refrain from participating in the IPO.