Mixue Group, the largest bubble tea chain in China, is set to kick off its Hong Kong initial public offering (IPO) by the end of February, aiming to raise approximately $500 million, sources familiar with the matter confirmed. The IPO will be a key milestone for the company, which boasts an impressive 40,000 stores across China.
Initially, Mixue had planned to raise up to $1 billion, but the size of the share sale has been reduced, as the company is not facing urgent cash needs. According to its regulatory filings, Mixue’s net profit for the nine months ending September 30, 2023, was $478.96 million, marking a 42.3% year-on-year growth. The company intends to use the IPO proceeds to expand its production facilities and diversify its drink offerings.
The IPO comes on the heels of a successful listing by rival bubble tea brand Guming, which raised $232 million, although Guming’s debut saw its stock fall after a strong retail demand-driven oversubscription. Despite these market jitters, the successful IPOs of Guming and Mixue signal that the freeze on bubble tea IPO approvals by Hong Kong regulators last year may now be easing.
While Mixue has seen robust growth, it remains cautious, scaling down its IPO plans in light of market volatility. The company is expected to begin trading on the Hong Kong Stock Exchange in early March, with hopes to further cement its position as a dominant player in the bubble tea industry.
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