Long-distance calling

21 June 2018 By Robyn Mak Follow @mak_robyn

The Chinese maker of affordable phones has scaled down its IPO with plans now to raise $6 bln. Much of the valuation hangs on internet services, which Xiaomi is starting to roll out in its top overseas market. Rivals in India are plentiful, though, and hungrier for content.

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Chinese smartphone maker Xiaomi plans to raise as much as $6.1 billion in its Hong Kong initial public offering by selling about 2.2 billion shares for between HK$17 and HK$22 apiece, Reuters reported on June 20, citing unnamed sources.

The Bejing-based, Cayman-domiciled company plans to bring in eight cornerstone investors to buy about 13 percent to 15 percent of the shares being offered, according to the report. They include U.S. chipmaker Qualcomm, Chinese express delivery company SF Holding Co Ltd, domestic telecom provider China Mobile and state-run conglomerate China Merchants Group Ltd, Reuters reported.

Xiaomi lowered its likely valuation to a range of $55 billion to $70 billion, according to an earlier Reuters report, following a decision to delay an expected mainland offering of Chinese depositary receipts.

International sales accounted for 36 percent of Xiaomi’s total revenue at the end of March, up from 28 percent at the end of last year. Xiaomi doesn’t break out sales by country, but says India is its largest market outside mainland China.

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