CENTURY-21 of China Shoots for an IPO

Posted Jan 6th 2010 3:40PM by Tom Taulli
Filed under: China, Initial Public Offerings

The name of the company is fairly ordinary: IFM Investments Limited. Yet, it is the exclusive franchisor of the CENTURY 21 brand in China (since 2000).

And to capitalize on the growth, IFM has filed to go public. In fact, this is one of the first filings in 2010.

So far, IFM has the largest network of real estate offices in China, with more than 1,000 locations across 34 major cities. There are roughly 14,900 agents and staff, which manage 4.7 million property listings. With its heft, IFM is ranked #3 in terms of real estate volume in China.

In terms of its growth strategy, IFM has three types of businesses: company-owned brokerages, mortgage services and franchises. All in all, the platform has scaled nicely -- and should continue to dos so. For example, IFN has strong information systems and training programs.

In terms of growth, IFM has increased revenues from RMB38.4 in 2006 to RMB273.4 in 2008. Already this year, revenues are up 112.4% to RMB443.7. What's more, the company turned profitable this year.

The lead underwriters on the IPO include Goldman Sachs (GS) and Morgan Stanley (MS).

Tom Taulli advises on business tax preparation and resolving tax problems. He is also the author of a variety of books, including the The Complete M&A Handbook. His website is at Taulli.com.

Tags: CENTURY 21, Century21, China, gs, inthenews, ms

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Reader Comments (Page 1 of 1)

1-16-2010 @ 3:43AM

Vincent said...

Don't buy this stock.

I have asked a few mom & pop Real Estate Agents in China
whether CENTURY-21 Real Estate China is their competitor they just laugh.

Remember that real estate agency in China is not a straightforward business as in the West.

To complete a transaction, real estate buyer or seller are expected to spent at least 40 hours running back and fort, in congested traffic, between various government offices and banks.

My experience tell me that these mom & pop brokers :
1) are extremely good at pushing paper works at government offices and banks.
2) have good connection with workers at various government offices and bank managers.
I have saved over $10000 USD in tax in a transaction last week thanks to a tip from a "friend" of my broker in a government agency.
I also save quite a lot on the mortgage at the bank where my broker has old "friend" as manager.
3) are willing to cut commission more than half.
4) have many other tricks in their hats that can help when "things" do not go smoothly as expected.

Most Chinese know, as I do, that mom & pop brokers are
better than the chain stores like Century 21.

If CENTURY-21 Real Estate China looks as good as their numbers showed they should issue their IPO in Shanghai or Shenzhen where it is sure to get higher valuation.
Its shares are listed in the USA because most investors in the USA don't know how really good or bad CENTURY-21 Real Estate China is.

Good luck USA investors!