Mixue Group to Raise $500 Million in Hong Kong IPO
Expansion Plans
China’s largest bubble tea firm, Mixue Group, plans to raise approximately $500 million in its initial public offering (IPO) in Hong Kong. The company will begin bookbuilding for its IPO by the end of February and is expected to start trading on the Hong Kong Stock Exchange in early March.
IPO Details
Mixue Group has 40,000 stores across China, according to its regulatory filings. The company had initially planned to raise up to $1 billion in its Hong Kong IPO, but the size of the share sale has been scaled back as the company is not in desperate need of cash. Two sources close to the matter revealed that the company’s net profit was 3.5 billion yuan (S$649 million) in the nine months to September 30 last year, up 42.3 percent year on year.
Use of Funds
The firm plans to use the money raised in its IPO to expand production facilities and help increase its range of drinks. This move is expected to further strengthen the company’s position in the market and drive growth.
Bubble Tea Industry
The IPO comes after rival bubble tea operator Guming raised $232 million in its Hong Kong IPO, which priced at the top of the price range. Guming shares are set to start trading in Hong Kong on Wednesday and were up 12 percent in gray market trading operated by brokerage Phillip Securities.
Regulatory Environment
The approval of Mixue Group’s IPO signals a thaw in the freeze on approving bubble tea firms’ listing applications by regulators. Last year, regulators were concerned about the bubble tea firms listing in Hong Kong after Sichuan Baicha Baidao fell by 27 percent on its first day of trading following its $330 million share sale. The stock is now down about 45 percent.
Conclusion
Mixue Group’s IPO is a significant development in the bubble tea industry, which has seen a surge in popularity in recent years. The company’s plans to expand production facilities and increase its range of drinks are expected to drive growth and strengthen its position in the market.
Frequently Asked Questions
Q: How much is Mixue Group planning to raise in its IPO?
A: The company is planning to raise approximately $500 million in its IPO.
Q: When is Mixue Group expected to start trading on the Hong Kong Stock Exchange?
A: The company is expected to start trading in early March.
Q: What are Mixue Group’s plans for the funds raised in its IPO?
A: The company plans to use the funds to expand production facilities and increase its range of drinks.
Q: What is the current state of the bubble tea industry in Hong Kong?
A: The industry has seen a surge in popularity in recent years, with several bubble tea firms listing in Hong Kong. However, regulators were concerned about the bubble tea firms listing in Hong Kong after Sichuan Baicha Baidao fell by 27 percent on its first day of trading.
