(Yicai Global) Jan. 24 -- China’s biggest auto aftersales service platform Tuhu has applied to go public on the Hong Kong stock exchange.

US investment banks Goldman Sachs Group and BofA Securites, as well as Switzerland’s UBS Group and the China International Capital Corp. are sponsors, according to the filing submitted to the Hong Kong bourse today. No details were given of the expected amount to be raised.

The funds raised will be used to upgrade Tuhu’s equipment, warehousing and freight network, increase research and development, improve data analyzing techniques, recruit talent as well as expand its store network and franchise base, operator Shanghai Lantu Information Technology said in the prospectus.

Tuhu has become an important player in the country’s highly competitive and decentralized auto aftersales service sector, that is expected to be worth CNY1.65 trillion (USD260.5 billion) by 2025, according to China Insights Consultancy.

The Shanghai-based firm, which uses an online-to-offline model, runs 3,369 outlets and 33,223 co-operative stores nationwide. Its app Tuhu Car had 72.8 million registered users as of last September, 10 million of which are monthly active users.

But losses have been widening over the past three years. In the first nine months of last year, Tuhu ran up a deficit of CNY4.4 billion (USD694 million) on revenue of CNY8.4 billion (USD1.3 billion). In 2020 it lost CNY3.9 billion and in 2019 CNY3.4 billion.

Internet giant Tencent Holdings is the biggest stakeholder in Tuhu with 19.41 percent equity. The firm’s founder, Chair and Chief Executive Chen Min owns 11.76 percent.

Editor: Kim Taylor