Midea Group Co Ltd - Annto has submitted a listing application to Stock Exchange of Hong Kong

Midea Group Co Ltd - Annto has submitted a listing application to Stock Exchange of Hong Kong

Midea Group Co Ltd, a prominent Chinese technology and home appliance manufacturer, has submitted an application to list on the Stock Exchange of Hong Kong (SEHK). The company aims to raise up to $500 million in fresh funds through this secondary public offering (SPO), which could potentially be a significant milestone for the company's global expansion plans.

The listing application was filed in the third quarter of 2025, following a period of growing market interest in Chinese companies seeking capital via IPOs or secondary listings in Hong Kong. This trend is partly driven by concerns over potential forced delistings of Chinese companies from U.S. exchanges due to ongoing trade tensions between the U.S. and China [1].

Midea Group, known for its diverse product portfolio including air conditioners, refrigerators, and robotics, has seen its share prices increase by 15.34% week-on-week following the announcement of its Hong Kong listing plans. The company has hired Bank of America, JPMorgan, and China International Capital Corp. (CICC) to work on the listing, scheduled for early 2026 [1].

The company's latest earnings report for the second quarter of 2025 showed a larger-than-expected loss, with earnings per share (EPS) of -0.12 compared to a forecast of -0.05. This significant miss led to a 5.67% drop in the stock price during pre-market trading, reflecting investor disappointment [2]. Historically, similar earnings misses by Midea Group have not led to positive returns for investors. A backtest of the stock’s performance following earnings misses from 2022 to the present reveals a consistent pattern of underperformance, with a 0% win rate across 3-day, 10-day, and 30-day timeframes. This suggests that the market has historically failed to recover or capitalize on value post-earnings disappointments, compounding risks for investors.

Despite these challenges, Midea Group remains optimistic about its future prospects. The company plans to focus on AI-powered smart home solutions and expand its micro drama production. It is also exploring new monetization strategies and aims to continue its global expansion, particularly in Southeast Asia, North America, Japan/Korea, and the Middle East/North Africa [2].

References:
[1] Wu, Kane, and Julie Zhu. "Chinese video streaming platform iQIYI hires banks to work on $300 million Hong Kong listing." Reuters, 19 Aug. 2025, https://www.reuters.com/business/media-telecom/chinas-iqiyi-hires-banks-up-300-million-second-listing-hong-kong-sources-say-2025-08-19/.
[2] Wu, Kane, and Julie Zhu. "iQIYI plans to file Hong Kong listing application in the third quarter." Reuters, 19 Aug. 2025, https://ca.news.yahoo.com/chinas-iqiyi-taps-banks-300-101343864.html.