Alibaba’s Freshippo, also known as Hema Xiansheng, is gearing up for an IPO in Hong Kong, with a potential valuation of over $10 billion. The grocery store chain has reportedly enlisted the help of investment banks, including China International Capital Corp. and Morgan Stanley, to explore a potential share sale.
The IPO is still in the early stages, and the size, valuation, and timing of the offering are yet to be determined. However, sources have confirmed that the company was considering raising funds at a valuation of $10 billion in January 2022.
Freshippo is a supermarket model that operates like Sam’s Club and currently has over 270 stores. The grocery chain reportedly turned profitable in 2022. If the IPO pushes through, it will be the second business unit of Alibaba to pursue a separate listing after Cainiao, BABA’s logistics arm, which reportedly began preparations for its own $20B+ market debut in March.
The move follows Alibaba’s announcement in mid-March, outlining its plan to split the business into six key units and allow each one to pursue an IPO.
Freshippo’s IPO is expected to generate a lot of interest, considering the company’s growing profitability and its success in capturing the online and offline retail market in China. By going public, Freshippo will have more resources to expand its business further and compete more effectively against rivals like JD.com and Pinduoduo.
