JD.com Stock Jumps In $3.87 Billion Hong Kong Secondary Listing, Coincides Company’s Flagship Sales Event

(Source: HKEX)

Chinese online retailer JD.com (9618.HK) Thursday made its secondary listing in Hong Kong with shares jumping 5.7% at the open of its first day of trading.

Following its longtime rival Alibaba Group who carried out its secondary listing in Hong Kong last year and mobile games publisher NetEase’s debut in the city last week, JD.com’s Initial Public Offering (IPO) marks another Chinese company that is already listed in the U.S. and now secures a “homecoming” fundraising in Hong Kong.

JD.com’s shares were priced at HKD 226 per share, and then rose 5.75% to HKD 239 at the opening this morning. By issuing 133,000,000 new Class A ordinary shares, the company is expected to raise about HKD 30.05 billion ($3.87 U.S. dollars).

“We plan to use the net proceeds from the public offering to invest in key technologies based on the supply chain to further enhance the customer experience and improve the operational efficiency,” JD.com said in a statement. “The supply chain-based technologies can replace our key business operations including retail, logistics and customer engagement.”

The company also mentioned its role as a supply chain-based company in its quarterly earnings report, saying that they are transforming from a “technology driven e-commerce company to a supply chain-based technology and service provider.”

SEE ALSO: NetEase and JD.com Set for Secondary Listings in Hong Kong

The secondary debut coincided with the company’s largest annual sales event, the “6.18 Mid-year Shopping Festival.” The nation-wide sales event was initiated by JD.com to celebrate its company anniversary, but has now turned into a campaign that lasts for weeks on all its rival e-commerce platforms such as Alibaba’s Tmall, Pinduoduo and Suning.

The company reported a 20.7% increase in its net revenues for the first quarter of 2020 to 146.2 billion yuan ($20.6 billion). Net revenues from the sales of general merchandise products reached 52.5 billion yuan ($7.4 billion), a year-on-year increase of 38.2%. The company has grown its annual shopper base to 387 million.

JD.com’s stocks have been trading on New York’s Nasdaq since 2015. Its shares closed up 1.69% on Wednesday trading. Its shares in Hong Kong closed at HKD 234 on Thursday, down about 2.13% from its opening price.