SHANGHAI: Shares of Chagee Holdings Ltd. jumped 16 per cent in their debut session after the Chinese tea chain raised US$411 million in its US initial public offering, defying a market besieged by trade-war volatility.
The Shanghai-based company’s American depositary shares pared initial gains to close at US$32.44 each on Thursday (April 17), versus the IPO price of US$28 apiece. Chagee priced 14.7 million ADS at the top end of their marketed range.
The trading gives the company a market value of US$3.8 billion, based on the outstanding shares listed in its filings.
The deal helped turn Chagee’s 30-year-old chief executive officer into a billionaire, according to the Bloomberg Billionaires Index.
Chagee moved ahead with its IPO as its beverage-chain peers have weathered dizzying US tariff decisions and its China-focused business is seen as being relatively unaffected by the trade war. In Hong Kong, tea-and-ice-cream giant Mixue Group’s shares have more than doubled since their March listing.
Ahead of taking IPO orders last week, Chagee had secured indications of interest from investors amounting to as much as US$205 million. Investors have expressed interest for several times the ADRs available, Bloomberg News has reported.
Some firms have paused planned US listings as market turmoil ensued. Analysts have also been war-gaming a scenario where Chinese stocks are booted off American exchanges.
Chagee’s IPO was led by Citigroup Inc., Morgan Stanley, Deutsche Bank AG and China International Capital Corp. The shares trade on the Nasdaq Global Select Market under the symbol CHA. - Bloomberg
