JD Logistics, the delivery arm of e-commerce giant JD.com Inc., has announced that it is seeking to raise as much as $3.4bn in its Hong Kong initial public offering (IPO), seizing on China’s online shopping boom sparked by the coronavirus pandemic.
The warehousing and shipping company is selling 609.2m shares at HK$*39.36 to HK$43.36 each, according to a statement published in the South China Morning Post. The company will start taking investor orders from Monday and is set to begin trading on May 28, in Hong Kong. The deal is expected to be priced on May 21, according to the terms of the IPO obtained by Bloomberg News.
At $3.4bn, JD Logistics would be the second-largest IPO in the city this year, after Kuaishou Technoloy’s $6.2bn listing in February.
JD Logistics’ first-time share sale comes as Hong Kong’s market shrugs off concerns over inflation. The city has hosted $20.5bn worth of IPOs so far this year, nearly seven times the $3bn raised in the same period in 2020, data compiled by Bloomberg show.
Created in 2007 and set up as a standalone unit under JD.com a decade later, JD Logistics’ networks include both last mile and longer distance lines, as well as cold chain and bulky item networks, according to its prospectus. It operated more than 900 warehouses across China as of the end of 2020.
The logistics firm’s revenue climbed 47% in 2020 to CNY73.4bn, the prospectus shows. The company reported a net loss of CNY4.1bn last year, compared to CNY2.2bn in 2019. It plans to use the proceeds from the IPO to upgrade and expand its logistics networks, develop advanced technologies and to expand its customer base.
JD Logistics has attracted seven cornerstone investors to its offering, who agreed to subscribe for about $1.53bn of stock, according to the terms.
Source: Bloomberg
HK1 = $0.13 / HK1 = €0.11
