Fintech firm Qudian buys $100mln stake in Secoo, eyeing luxury eQQcommerce business

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According to Qudians statement, the two sides will also enter into a business cooperation agreement to forge strategic collaboration in the online luxury e-commerce business.

We believe this strategic partnership will enable us to accelerate growth by building upon both companies assets, core expertise and competitive advantages, Li noted.

Secoo cing fierce market rivalry

Su Xiaorui, senior researcher at Madai Research Institute, pointed out that product quality and traffic flow will be the success ctors for Qudians luxury e-commerce business.

Yu Baisheng, head of 01 Research Institute, analyzed Qudians key financial business was significantly affected by the regulatory changes and the end of partnership with Alipay.

Secoo, which was founded in 2008, is known as a top player in the online luxury e-commerce market and offers over 400,000 SKUs, covering over 3,800 global and domestic brands on its online and offline shopping platforms.

The investment in Secoo further enhances Qudians efforts in business shifting.

In 2014, Tmall set foot in the luxury market by getting Burberry and other high-end brands to open flagship stores on the e-commerce platform.

Later in 2022, Alibaba launched Tmall Luxury Pavilion, a dedicated site for premier brands such as Hugo Boss, La Mer, Maserati, Guerlain and Zenith.

The foray into the luxury e-commerce market is seen as Qudians another attempt for growth after it seeks new growth engine in education, automobile and other fields outside the financial sector. This March, Qudian launched its own luxury e-commerce platform Wanlimu.

Qudian seeking business shift to luxury e-commerce sector

Compared to Tmall and JD.com that boast huge traffic flow, Secoo holds less traffic but deeper ties with high-end brands, media reports said. Secoo said it has built partnership with 3800 brands to date while data shows JD.coms Farfetch has had over 500 brand partners and over – brands have opened their shops on Tmall.

Secoo chairman and CEO Li Rixue is bullish on the business growth potential brought by the new cooperation with Qudian.

Upon the completion of all transactions, Qudian will hold an approximately 28.9 percent stake in Secoo, it the largest shareholder of the latter.

Set up in 2014, Qudian was a leading cash loan provider in China, but the growth momentum has been weakening in recent years. Qudians financial reports show that the company posted a net loss of 486 million yuan (68.4 million U.S. dollars) in the first quarter of 2022, representing its first and also massive loss since it got listed on the New York Stock Exchange. In the fourth quarter of last year, its net profit was logged at 127.9 million yuan, down 83.3 percent from a year earlier.

June 4 (NBD) – Chinese financial technology firm Qudian, Inc. (NYSE: QD) inked an agreement with Secoo Holding Limited (NASDAQ: SECO), Asias largest online integrated upscale products and services platform, to purchase up to 10,204,082 newly issued Class A ordinary shares of Secoo for an aggregate purchase price of about 100 million U.S. dollars.

Buoyed by the new deal, Secoos stock opened more than 100 percent higher at 4.24 U.S. dollars on Wednesday and then closed the day with a 52.56 percent rise at 3.28 U.S. dollars, while shares of Qudian surged by 5.44 percent to close at 1.55 U.S. dollars on the day.