Chinese e-retailing giant Jumei ready for $400 million US IPO

14-Apr-2014 - Last updated on 14-Apr-2014 at 14:48 GMT

Jumei, one of the largest Chinese retailers of beauty products online by volume, has filed to raise up to $400 million at its upcoming IPO in the US.

The company is behind over a fifth of online beauty sales in the China, and has over 10.5 million active customers and 1,700 suppliers, according to the prospectus it has filed with the US Securities and Exchange Commission (SEC).

The Beijing-based brand describes itself as the “no. 1 online retailer of beauty products in China”, and hopes to take advantage of the apparent rise in investor enthusiasm for China stocks taking place at the moment.

It did not state the exchange on which the brand intends to list, nor how many shares it plans to sell or their expected price.

Timely

Reuters reports about 30 firms could list in the US this year, the figures are the biggest since 2010, and Jumei’s filing is well-timed to come early in the rush.

According to Huang Yuanpu, founder of an e-comerce market intelligence firm, who spoke to The Global Times: "It is now a good time for Jumei to get listed in the US, especially ahead of Chinese Internet giant Alibaba, to woo the American investors."

China's online transaction volume jumped 42% last year to $305 billion and is expected to almost double in size by 2016; interest is trumping accounting irregularities and corporate governance concerns that forced many U.S.-listed Chinese firms to be delisted since 2011.

Online strong

Jumei, which stocks such brands as Calvin Klein, Estee Lauder, and Avon, has profited well from the recent healthy growth in China’s beauty market, which according to a Forst & Sullivan report grew from $22.5 billion in 2010 to $36.5 billion in 2013.

The report names Jumei alongside Watsons and Sephora as the three largest beauty products retailers in China in terms of GMV in 2013.

Jumei attributes its growth over recent years to e-commerce, and looking forward, voices confidence that mobile sales will continue to drive this trend.

“We believe consumers will increasingly shop online through mobile internet. Therefore, we have invested substantial resources to build a mobile platform dedicated to providing a superior mobile shopping experience,” the company has said.

“In the first quarter of 2014, approximately 49% of our GMV was generated through our mobile platform,” it confirms.