Jan 16, 2020 (China Knowledge) - Jiumaojiu International Holdings Limited, a Chinese cuisine restaurant chain operator, has recently raised HKD 2.08 bln in an initial public offering (IPO) in Hong Kong on early Wednesday.
The company’s stock was sold at HKD 6.60 per share which is the top end of its proposed range of HKD 5.50 to HKD 6.60. Proceeds could total up to HKD 2.39 bln if additional allotment of shares is distributed to meet excess demand. The IPO of Jiumaojiu is so far the largest stock offering in the city in 2020.
The proceeds will be used to expand the restaurant network, strengthening the supply and support capacities, and augment its centralized procurement system.
Jiumaojiu operates as a Chinese cuisine restaurant and brand operator that specializes in providing quick meal services with restaurants furnished in modern decorations. It operated 287 restaurants and managed 41 franchised restaurants in 39 cities in China as of December 2019 and plans to open about 370 new self-operated restaurants from 2019 to 2021.
According to the prospectus, the firm recorded RMB 1.24 bln in total income and RMB 116 mln in net profit in the first half of 2019, compared to a total income of RMB 1.89 bln and a net profit of RMB 101 mln in 2018.
Charles Li Xiaojia, CEO of Hong Kong Exchanges and Clearing Limited (HKEX), expects more Chinese companies to list on the city’s exchange in 2020 due to its proximity to the home market and companies’ desires for a more diversified mainland shareholder base amidst the current geopolitical uncertainties.
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