JD Logistics, the distribution arm of Chinese e-commerce giant JD.com, is planning to submit an initial public offering application to the Hong Kong stock exchange as soon as this month, according to reports.
The logistics business is targeting a valuation of $40 billion and plans to start trading in the second quarter, according to Refinitiv publication IFR and Chinese news outlet The Paper. The IPO could raise between $2 billion and $3 billion, Reuters previously reported.
JD Logistics would be the latest subsidiary of the parent company to be spun off and listed in Hong Kong.
JD Health International completed a HK$31 billion ($3.5 billion) IPO in December 2020, and the company’s fintech arm, JD Digits, has filed an application to list on Shanghai’s tech-heavy STAR Market, aiming to raise around 20 billion yuan.
JD.com jumped 5.5% to HK$372.40 following the news. Pandaily has reached out to the company for comment.
The distribution business, which operates more than 800 warehouses nationwide and delivers packages for the e-commerce platform, was spun off into a standalone entity in 2017. According to Reuters, an IPO for the unit has been under consideration for almost a year.
UBS, Bank of America and Haitong Securities could be the sponsors for JD Logistics’ IPO, Reuters reported. UBS and BofA also sponsored JD.com‘s HK$34.5 billion secondary listing in June.
Last month, Wang Zhenhui, former CEO of JD Logistics, resigned and was replaced by Ya Rui, the company’s chief human resources officer.