A Dada rider Photo: Chinanews.com
JD.com-backed on-demand delivery platform Dada Nexus filed for a $100 million US listing on Tuesday, becoming the second Chinese firm after Kingsoft Cloud to seek funding from US IPO following Starbucks rival Luckin Coffee's fraud scandal.
In its filing with the US Securities and Exchange Commission (SEC), the Shanghai-based firm revealed it has applied to list on NASDAQ's Global Select Market, known for having the highest listing standards in the world. Underwriters of the IPO include Goldman Sachs (Asia), BofA Securities and Jefferies.
US-listed Chinese firms are set to embrace the first on-demand retail component.
In the 12 months ending on March 31, 822 million orders were delivered collectively by more than 634,000 active riders, per its SEC filing.
Dada recorded a three-digit growth in revenue in the first quarter as brick-and-mortar consumption succumbed to the coronavirus outbreak, which spurred on-demand retail and delivery growth, Mo Daiqing, a senior analyst with the China ecommerce research center, said in a note sent to the Global Times on Wednesday.
But Dada would be under pressure to maintain such high growth when the epidemic becomes less of a global health threat, Mo said.
A rally in shares of its most recent predecessor has beefed up market confidence in Chinese stocks listed in the US.
Kingsoft Cloud stock trading debuted on the NASDAQ on May 8, soaring 40.24 percent on the IPO day.
The stellar stock performance of the Xiaomi-backed cloud services firm defied market expectations that the appeal of Chinese stocks to US investors would be dampened by the financial scandal that tainted Luckin Coffee.
Luckin announced Tuesday that it had sacked its CEO and COO following an internal probe into its sales fabrication. Luckin Coffee chairman Charles Zhengyao Lu has also left the firm's nominating and corporate governance committee.
An economy-defied rally in US stocks apparently gives a tailwind for Chinese stocks. A notable example is NASDAQ-listed Pinduoduo. The Chinese e-commerce platform competing with Alibaba and JD.com, ended on a record high of $57.83 on Tuesday.
