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China Tourism Group Duty Free gets approval for IPO, targets biggest Hong Kong listing this year at US$2.7 billion
- The company’s flotation has received approval from the Hong Kong stock exchange’s listing committee
- The company’s mainland shares have dropped this week as Covid-19 restrictions hit the duty-free shopping haven of Sanya in Hainan province
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China Tourism Group Duty Free has received approval from the Hong Kong stock exchange’s listing committee for its flotation on the main board, according to a filing late on Tuesday.
The company will start book building as soon as Friday and aims to raise around US$2.7 billion in what could be the biggest initial public offering (IPO) in the city this year, according to market sources.
The company’s mainland stock has lost at least 7.8 billion yuan (US$406 million) in market value so far this week as Covid-19 disruptions took hold in Hainan province.
This marks the second attempt by the world’s largest travel retailer by sales to sell shares in Hong Kong, after it shelved the plan in December, citing sluggish market conditions.
The Shanghai-listed company is hoping to capture more of the billions of dollars Chinese consumers are spending in the tax-free shopping zone on Hainan island, a revenue source that has gained more importance as the country’s zero-Covid policy continues to limit international travel.
The company operates five duty-free shops in Hainan and has one under construction in the provincial capital, Haikou. It also operates the world’s biggest duty-free complex in Sanya and accounts for about 90 per cent of the market there. Hainan is expected to account for half of a US$40 billion duty-free market by 2025.
Iris Ouyang is a business reporter for the Post. She has reported in Washington D.C., Beijing, and Hong Kong in the past several years for both Chinese and international media organisations such as Caixin, Phoenix Finance, MNI, USA Today, MarketWatch and American Banker.
Georgina Lee has been a financial journalist for more than 15 years, having worked for newswires and trade magazines before she joined the Post. She has also previously written research articles on key structured credit themes for a credit rating agency.
Enoch joined the Post as a business reporter in 1996. Before that, she worked at a Chinese daily newspaper for four years. She is the author of two books: 'They Mean Business: 50 exclusive interviews with Hong Kong top executives' and 'Serving with Passion: stories of established catering brands in Hong Kong'.
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