(Photo/VCG)

Nov. 6 (NBD) --Yulong Computer Telecommunication Scientific (Shenzhen) Co., Ltd., the subsidiary of Coolpad Group Ltd.(Coolpad), signed an agreement with Shenzhen Xinghuaan Real Estate Development Co., Ltd. last month in a move to rise above the current problems clouding LeEco. Under the agreement, both sides will jointly develop the first, second and third phases of urban renovation project of Coolpad Information Harbor in Shenzhen.

Capital is no longer a problem for Coolpad since September this year, and the company also meets with various investors, said Du Jinbiao (James Tu), chief executive officer of Coolpad Global Sales & Service and executive vice-president of the Coolpad Group.

"Coolpad has land resources worth nearly 10 billion yuan (1.5 billion U.S. dollars) that has interested a number of land agents and the company is also seeking for more syndicated loan." Liu Jiangfeng, the former CEO of Coolpad said in August this year.

However, Yan Yuejin, the research director of E-house China R&D Institute, said that Coolpad's land resources are valuable but how to develop projects to gain revenue with high cash flow is crucial. Coolpad's transformation at this stage is incomprehensive, said Yan.

Coolpad made a loss of HK$4.2 billion (538.5 million U.S. dollars) in 2016 and the company's operations have not improved this year. Based on the preliminary assessment of the Group’s unaudited consolidated management accounts, the Group recorded an operating income of approximately HK$2,716 million (348.2 million U.S. dollars) as at 31 July 2017, representing a year-on-year decline of 52%, according to the announcement made by the company in HKEX on 15th Auguest.

Apart from the operating loss, the Group has been sued by Ping An Bank, Bank of Ningbo and Shanghai Pudong Development Bank (SPD Bank) for the debt of 240 million Yuan (36.2 million U.S. dollars).

The company is also facing difficulties in mobile phone sales in domestic market.

This year, Coolpad fell out of the top 10 of the mobile phone market share ranking list.

The market share of Coolpad as well as ZTE, Lenovo is almost negligible in the market of medium-end mobile phones worth 2500 to 2999 yuan (689.7 to 452.7 U.S. dollars), accounting for less than 3% of the total, according to a research report released in July. 

The domestic mobile phone market has been divided by Huawei, Samsung, Apple, Oppo, Vivo and other producers.

In this case, Coolpad pays more attention to the U.S. market.

According to Du Jinbiao, 90% of the mobile phone market in the U.S is controlled by operators, which is favorable to Coolpad's development. The company's R&D has mainly focused on U.S. market and the strongest sales team and other resources have also been put into the U.S. market.

In the first half of 2017, the shipment of coolpad rose 60% year on year in the U.S., which is the fastest growing market and the biggest market for Coolpad. The company won second in the shipment among Chinese producers in the U.S. market. In the next 2 or 3 years, coolpad aims to become the first among Chinese brands in the U.S. market, Du added.

Du further analyzed that it has been proven that the U.S. market greatly helps Coolpad to alleviate its current difficulties and the company will never give up the domestic market. Except for focusing on the premium phones and operators, Coopad will continue to expand the business such as non-mobile hardwares used in Internet of Things, noted Du.

Email: zhanglingxiao@nbd.com.cn