Chinese bubble tea chain Nayuki Holdings Ltd is seeking to raise as much as HK$5.09 billion (US$656 million) in a Hong Kong initial public offering (IPO), the latest company to test a rebound in investor appetite for listings in the Asian financial hub.
Nayuki, whose popular fresh-fruit teas include cheese-foam-topped beverages, is offering 257.3 million shares at HK$17.2 to HK$19.8 apiece, it said at a press conference on Thursday.
The company, which was valued at US$2 billion at its last funding round, expects to set its final IPO price on June 23, with shares set to start trading on June 30.
Nayuki's offering comes as new share sales pick up this month following a two-month lull. After a strong start to 2021 — when rallying stocks, ample liquidity, and ultra-low interest rates fuelled demand — listings in Hong Kong abated as investors became more selective amid concerns about rising inflation and higher volatility in markets.
The bubble tea chain, one of the biggest in China, had originally planned to go public in the US, until the coronavirus
outbreak clouded its plans.
Nayuki filed confidentially for an IPO in the US in February last year, Bloomberg News reported. Approximately 61% of its teahouses in China had temporarily closed for seven or more days that month alone, when the Covid
-19 outbreak in the country peaked, according to its prospectus.
Companies have raised about US$25 billion from Hong Kong IPOs this year, more than double the amount during the same period last year. Angelalign Technology Inc, a maker of clear orthodontic braces, registered a 132% pop on its first day of trade on Wednesday in one of the most popular offerings in the city this year, signalling a revival for the IPO market.
Nayuki recorded an adjusted net profit of 7.3 million yuan (US$1.1 million) and revenue of 959.1 million yuan in the three months ended in March, according to its listing prospectus. It posted revenue of about 3.1 billion yuan in 2020, a 22% increase from the previous year.
The Shenzhen-based company raised more than US$100 million at the end of last year in a series C funding round led by private equity firm PAG that also included billionaire Jack Ma
's Yunfeng Capital. At that time, the company was valued at nearly US$2 billion.
The chain sells fresh-fruit teas as well as cold brew teas and baked goods. It plans to use proceeds from the offering to expand its teahouse network, deepen market penetration, and strengthen its supply chain, among other general corporate purposes. It had 491 Nayuki teahouses, including 489 in 66 Chinese cities, one in Japan, and one in Hong Kong at the end of last year.
JPMorgan Chase & Co, CMB International Capital Ltd, and Huatai International Ltd are joint sponsors for the deal.