China’s largest bubble tea chain, Mixue Group, made its highly anticipated initial public offering (IPO) debut on the Hong Kong Stock Exchange, with shares jumping more than 47% in their first day of trading. The company raised $444 million by selling 17 million shares at a fixed price of HK$202.5 each.
Mixue is known for selling drinks at affordable prices, including as low as 6 yuan ($0.82) per cup. This approach has driven demand from retail investors, who subscribed for 5,258 times more shares than were on offer in the IPO. The company’s retail subscription rate was just below Bloks Group’s record-breaking 6,000 times oversubscribed rate in its January IPO.
The strong debut of Mixue is a welcome sign for Hong Kong’s IPO market, which has seen $1.44 billion worth of listings so far this year, making it the best start to a year since 2021. This upward trend is attributed to Beijing’s efforts to support private enterprises and revive the slowing economy amid heightened geopolitical tensions.
Mixue’s founder, started as a small ice shop in 1997, has grown into a global franchise giant with over 45,000 stores worldwide. The company operates primarily through franchising, selling food materials, packaging, and equipment to thousands of franchisees. Mixue reported a net profit of 3.49 billion yuan in the first nine months of 2024, up from the previous year.
The success of Mixue’s IPO has sparked hopes for a strong year in new equity issuances by Chinese companies in Hong Kong. This trend is also seen as beneficial for brokerages and investors, who are eagerly awaiting new listings to participate in.
Source: https://www.reuters.com/markets/deals/china-tea-drinks-mixue-shares-rise-nearly-30-hong-kong-trading-debut-2025-03-03