Smartphone Firm Honor Seeks Valuation of $45B in IPO

Bloomberg reported on Tuesday afternoon that Chinese smartphone manufacturer Honor is considering a domestic public listing this year with a potential valuation of $45 billion, citing individuals with knowledge of the matter.

Honor has not yet responded to the report. Firm personnel said to Sina Tech that they had just seen the news internally and were drawing up a company response. In a subsequent correspondence with 36Kr, Honor staff flatly denied reports that it was considering a domestic IPO this year in which it would raise $45 million, calling it false news.

Honor was established on December 16, 2013. It was originally a sub-brand owned by telecommunications giant Huawei, focusing on the low and middle-end smartphone market. Due to the continuous pressure placed on Huawei by the US, Honor suppliers, production plants and distribution channels have all faced difficulties.

On November 17, 2020, Huawei Investment & Holding Co., Ltd. decided to sell its Honor business assets as a whole, and the acquirer was Shenzhen Zhixin New Information Technology Co., Ltd. Huawei no longer holds any shares in Honor, nor does it participate in its operation, management and decision-making.

After Honor was detached from Huawei, there were frequent rumors of its public listing. Regarding this, Honor CEO George Zhao once responded that he paid more attention to whether the development of the company’s business and product innovation meets the needs of consumers and whether he could win future market competitions. “Honor employees never expect to get rich overnight, and the competition is about innovation, quality and service,” said Zhao.

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According to public data, the market share of Honor’s smartphones fell to 3% in Q1 of 2021. After that, its share began to rise rapidly. According to the latest report released by CINNO Research, the total sales volume of smartphones in China in February was about 23.48 million units, down 20.5% year-on-year and 24.0% quarter-on-quarter, both shrinking. Among them, OPPO, Honor, Apple, vivo and Xiaomi ranked in the top five, with sales of 4 million, 3.9 million, 3.8 million, 3.8 million and 3.6 million units, respectively. It is worth noting that among the top five smartphone brands, only Honor increased, with sales up 141.6% year-on-year.