China Tea Drinks Giant Mixue Shares Surge Nearly 30% in Hong Kong Trading Debut

Mixue Bingcheng, the Chinese ice cream and tea chain, saw its shares rise nearly 30% in its Hong Kong trading debut on March 3, 2025. The company's initial public offering (IPO) was heavily oversubscribed, with the Hong Kong offering over 5,200 times oversubscribed and the international offering over 35 times oversubscribed. This overwhelming demand indicates strong investor interest in the company.

Mixue Bingcheng is known for its milk tea, fruit drinks, ice cream, and coffee, which are often priced at $1 each. Its IPO comes weeks after Guming's, another Chinese bubble tea chain. Shares of China's largest bubble tea chain Mixue jumped 24% on market debut after a heavily oversubscribed initial public offering.

The company had priced its IPO at HK$202.5 per share ($26.04) for 17.06 million shares, raising a total of HK$3.45 billion ($445.2 million). The IPO has gained the support of five cornerstone investors, including M&G Investments, HongShan Growth, Persistence Growth Limited, HHLR Fund, and Meituan's Long-Z Fund.

Mixue Bingcheng is the largest ready-made beverage company in the world in terms of store count, with over 46,000 stores across 11 countries. In the first three quarters of 2024, the company achieved net profits of CNY3.5 billion ($482.2 million), well ahead of competitors such as Naixue, Dreamiya, and Guming.

Mixue Bingcheng plans to issue 17.06 million new shares in Hong Kong, under the stock ticker 2097, amounting to 4.52% of its total shares. The issue price was set at HK$202.50 ($26), with a total fundraising target of HK$3.4 billion ($445.2 million), which would give the beverage maker a market valuation of about HK$76.3 billion ($9.8 billion) after the offering.

Around 66% of the proceeds will be used to expand Mixue's global footprint, with 12% allocated to building its brand and intellectual property, and another 12% to strengthen digital and smart capabilities across the business. The rest will be used to supplement working capital and other general business purposes.

Mixue Bingcheng's strong financial performance, coupled with the company's expansion plans and the growing demand for tea drinks in China and globally, has contributed to the surge in its share price. The company's IPO strategy, which involved pricing the IPO at a level that attracted both retail and institutional investors, also played a significant role in the share price surge. Additionally, the company's cornerstone investors, who have a vested interest in the company's success, have likely contributed to the share price surge.