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Chinese grocery platforms Missfresh, Dingdong scale down US IPO fundraising targets amid investor concerns about growth outlook

  • Missfresh and Dingdong Maicai plan to raise over US$300 million each from their IPOs, some 40 per cent lower than their initial targets
  • Investors hold mixed views about growth outlook for Chinese on-demand delivery platforms as competition remains intense

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A delivery worker of Chinese online grocery Dingdong Maicai is seen in Shanghai. The company is preparing to list on the New York Stock Exchange. Photo: Reuters
Georgina Lee

Two Chinese online grocery platforms – Missfresh and Dingdong Maicai – are aiming to raise smaller amounts from their US unitial public offerings (IPOs) than initially planned, reflecting concerns among investors about their growth outlook amid intense competition in the mainland’s on-demand delivery market.

Tencent-backed Missfresh is seeking to raise up to US$336 million from the sale of 21 million American depositary shares (ADS) on Nasdaq. The Beijing-based firm is marketing the ADS, representing three ordinary shares, to investors at a range of US$13 to US$16 each, according to its updated filing with the Securities and Exchange Commission on Tuesday.

Shanghai-based Dingdong Maicai, backed by Sequoia Capital and Tiger Global Management, is also seeking to raise as much as US$357 million from the sale of 14 million ADS on the New York Stock Exchange, marketing them at a range of US$23.50 to US$25.50 each. Every two ADS represents the firm’s three ordinary shares.

Both companies had initially hoped to raise about US$500 million, people familiar with the transactions had said earlier this month.

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Delivery courier in China goes to work with baby girl in tow

Delivery courier in China goes to work with baby girl in tow
Bankers involved in the two deals said the competitive operating environment, coupled with the fact that both operators continue to incur losses, have stoked concerns among prospective investors over the growth outlook of the grocery delivery platforms after the pandemic subsides.
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