Leading Chinese Home Appliance Company Plans Hong Kong IPO... Up to 4.7 Trillion Won

The Largest Scale of the Hong Kong Stock Market Since May 2021

China's largest home appliance manufacturer, Midea Group, is planning an initial public offering (IPO) on the Hong Kong Stock Exchange worth up to $3.5 billion (approximately 4.6886 trillion KRW), Bloomberg reported on the 9th. It is expected to be the largest IPO on the Hong Kong Stock Exchange in the past three years.

According to the listing documents released that day, Midea Group plans to offer a total of 492.1 million shares at HKD 52 to 54.80 per share. The lower bound of the pricing is set at a 25% discount compared to the closing price on the previous trading day, June 6, on the Shenzhen Stock Exchange. Midea Group announced that it will price the shares on the 13th and list on the 17th, marking about 11 years since its listing on the Shenzhen Stock Exchange in 2013.

[Image source=Reuters Yonhap News]

Bloomberg expects Midea Group's listing to invigorate the Hong Kong IPO market. The Hong Kong Stock Exchange raised over $50 billion (approximately 66.99 trillion KRW) through IPOs in 2020, but this year it has only reached $2.5 billion (approximately 3.3495 trillion KRW). Since the battery supplier CALB Group's IPO in 2022, the Hong Kong Stock Exchange has not seen any IPOs exceeding $1 billion (approximately 1.3398 trillion KRW). Midea Group's IPO is expected to be the largest on the Hong Kong Stock Exchange since JD Logistics raised $3.6 billion (approximately 4.8233 trillion KRW) in May 2021.

Even on a broader scale across China, this IPO is significant. According to Bloomberg, Midea Group's IPO will be the largest in China since China National Offshore Oil Corporation (CNOOC) raised $5 billion (approximately 6.699 trillion KRW) in April 2022.

Founded in 1968, Midea Group is China's largest home appliance manufacturer. It acquired the home appliance business of Japan's Toshiba in 2016 and also owns the German robotics company KUKA. Midea Group's net profit for the first half of the year increased by 14% year-on-year to 20.8 billion yuan (approximately 3.92 trillion KRW), and revenue rose 10% to 217 billion yuan (approximately 40.8958 trillion KRW). Its stock price on the Shenzhen Stock Exchange has risen about 15% this year.