On Friday, Mixue Group, the largest bubble tea and drinks firm in China, announced its intention to raise HK$3.45 billion ($443.66 million) through IPO (initial public offering) in Hong Kong.
The process of book building has already begun on Friday to offer 17.1 million shares at a fixed price of HK$202.5 each. The first trading day for Mixue is expected to be on March 3 this year in the Hong Kong Stock Exchange.
After which, Mixue will have a value of $9.8 billion, with five cornerstone investors already agreeing to subscribe Mixue’s stocks worth $200 million.
Initially, the company planned to raise up to $1 billion. However, according to Reuters’ sources, Mixue decided to scale down its goal since the company was not in a dire situation for cash.
The bubble tea firm is very successful as the company has 45,000 stores in China alone and more branches across 11 other countries.
Its snowman mascot wearing a crown and a red cloak has attracted several young customers. Furthermore, its main products, such as fruit, tea drinks, coffee, and ice cream, only cost about $1.
By the end of September, more than 45,000 stores of Mixue were franchised. However, Mixue’s income did not mostly depend on the franchise fees.
This fee only made up 2.4% of 2024 first three quarters’ revenue. The main bulk came from the sale of merchandise and equipment when Mixue franchised its stores.
Independent analyst Zhu Danpeng stated that despite Mixue being the world’s largest fast-food chain by store count, the bubble tea firm still has room to grow in China.
Zhu added there are approximately 200,000 small, non-standardized single stores in rural areas, towns, and villages that Mixue can replace.
In 2024, Mixue stated its record sale of 7.1 billion drinks in the first three quarters alone.