Puyi Inc (NASDAQ:PUYI) Q4 2019 Earnings Conference Call - Final Transcript

Mar 26, 2020 • 09:00 pm ET


Puyi Inc (NASDAQ:PUYI) Q4 2019 Earnings Conference Call - Final Transcript


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Ren Yong

products. Firstly, we decided to take the form of thermal package publicly raised fund products as our core products to expand our client basis, and encourage clients to invest on a dollar cost averaging basis, which is to encourage client to invest for long-term. Public fund product is a truly standard market-oriented product with no investment threshold and high liquidity, which is suitable for the mass affluent and emerging middle class population.

During the reporting period, the revenue generated from distribution of publicly raised fund products was RMB13 million, representing over 8 times increase year-over-year. The transaction value of publicly raised fund products was RMB2.2 billion, an increase of 100% year-over-year. As of December 31st 2019, the outstanding balance of publicly raised fund products was RMB1.9 billion, representing a 215.3% increase year-over-year.

We have successfully created the package for publicly raised fund product series, G-New [Phonetic] brand series. G-New can be literally translate as [Indecipherable]. Till now, we have launched G-New balance of which the funds focus on balanced funds. G-New all stocks of which the funds, primarily invested in domestic publicly traded stocks. And G-New Hong Kong stock of which the fund is primarily focus on investment in Hong Kong public traded.

During the reporting period, we launched a new no risk package publicly raised fund products, which primarily focus on debt instruments. In the future, we will further improve and enrich our products. According to the market situation and to build investment needs of different clients.

[Foreign Speech]

Second, for distribution of privately raised fund products. According to our [Indecipherable] and judgment of China's macroeconomic development. Now understanding of the investors [Phonetic] risk preference. If we increase the distribution of privately raised fund products that mainly in public traded fund stocks. Especially, we focus more on distribution of fund of funds under our management. During the reporting period all the fund of funds security series under our management had a good performance.

[Foreign Speech]

And last but not least since October 2019 based on our long-term strategy, which is focus on truly market-oriented wealth products. We actively cease to offer non-fund financial products.

[Foreign Speech]

Next in terms of our current market strategy, we increase result allocation, promotion activities and firmly see [Technical Issues] opportunity period to expand our client basis. During the first half of the fiscal year 2020, we invested approximately RMB22 million in marketing activities. Accordingly, the aggregated -- the number of clients purchasing public fund products increased from 75,000 as of June 30, 2019 to 184,000 as of December 31st 2019. And average client acquisition cost was around 200 per client. In the view of our management, it's worthy to spend such amount to expand client base, because the incremental value, the new client can contributed to us in the future is much higher, we believe that for the result allocation to market promotion activities, as well as the dedicated layer management of our public fund product clients. We can now only bring us