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BEIJING - Kuke Music Holding Limited (NYSE: KUKE), a prominent classical music service platform in China with a current market capitalization of $11.3 million, announced a modification to its American depositary shares (ADSs) structure. The announcement comes as the company’s stock trades near its 52-week low of $0.23, having declined about 87% over the past year. According to InvestingPro analysis, the stock appears undervalued based on its Fair Value assessment. The company stated that it will change the ratio of its ADSs to its Class A ordinary shares from one-to-one to one-to-ten. This adjustment is effectively a one-for-ten reverse ADS split for the company’s ADS holders. InvestingPro data shows the stock has experienced high price volatility, with a beta of 0.25 over the past five years.
The change is scheduled to be effective on or about March 13, 2025, pending the effectiveness of a post-effective amendment to the ADS Registration Statement on Form F-6 with the SEC. ADS holders will be required to exchange every ten existing ADSs for one new ADS after the close of business on the effective date.
Deutsche Bank (ETR:DBKGn) Trust Company Americas, the depositary bank for Kuke’s ADS program, will manage the exchange process. No new fractional ADSs will be issued; instead, fractional entitlements will be aggregated, sold, and the net proceeds will be distributed to the relevant ADS holders after necessary deductions.
This ratio change will not affect the company’s underlying Class A ordinary shares, as no new shares will be issued or cancelled. Kuke’s ADSs will continue to trade on the New York Stock Exchange under the ticker symbol KUKE. The company anticipates that the ADS trading price may proportionately increase post-change, but it provides no assurance regarding the post-change trading price.
Kuke Music Holding Limited boasts a comprehensive classical music platform in China, offering content provision and music learning services. Recent financial data reveals the company achieved revenue growth of 10.5% in the last twelve months, with a gross profit margin of approximately 46%. Want deeper insights? InvestingPro subscribers have access to over 10 additional key metrics and exclusive analysis tools. Its partnership with Naxos, a global leader in classical music content, enriches Kuke’s extensive music library. The company also provides music licensing services, subscription services to educational and institutional entities, and hosts the prestigious Beijing Music Festival. Kuke’s smart music learning solutions aim to enhance the accessibility and quality of music education in China.
The information in this article is based on a press release statement from Kuke Music Holding Limited.
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