JD.com Unit Eyes $484M IPO Amidst Market Caution

JDi, an industrial supply chain technology and services provider in China and a unit of JD.com, is preparing for its Hong Kong initial public offering. The company aims to secure between HK$12.70 and HK$15.50 per share, potentially raising up to HK$3.27 billion ($420.08 million). This offering represents a modest stake of roughly 7.7% of JDi's enlarged share capital, with provisions for an additional 15% over-allotment option that could boost total proceeds to as much as $484 million.

The impending IPO suggests a post-offering valuation ranging from $4.5 billion to $5.5 billion, a figure notably lower than its $6.7 billion valuation during a pre-IPO round in 2023. This valuation adjustment may reflect the current cautious market sentiment in Hong Kong, influenced by U.S. market volatility. The company plans to strategically allocate IPO funds towards enhancing its supply chain capabilities and expanding its business operations across various locations over the next two to three years.

Final pricing for the offering is anticipated on December 10, with trading expected to commence on the Hong Kong exchange the following day. A significant portion, about $170 million, will be acquired by seven cornerstone investors, including M&G and CPE I Investment. JDi, its cornerstone investors, and pre-IPO backers will adhere to a six-month lock-up period, while controlling shareholders face a 12-month restriction, ensuring market stability post-listing.