Largest Chinese IPO in Four Years, Pinduoduo Lifts Off on Nasdaq

By 2 p.m. in New York, the stock of the Chinese unicorn was at $26.66 per share, up more than 40 percent.

CapitalWatch Staff
    Jul 26, 2018 11:40 AM  PT
Largest Chinese IPO in Four Years, Pinduoduo Lifts Off on Nasdaq
resource from: (Bilin Lin / CapitalWatch - New York)   
(Bilin Lin / CapitalWatch - New York)

The stock of the unicorn Pinduoduo Inc. (Nasdaq: PDD) soared more than 40 percent Thursday as it lifted off with fanfare and raised $1.6 billion in one of the largest initial public offerings in New York by Chinese companies in four years.

Pinduoduo, a three-year-old social discounter platform became a publicly traded company just before noon today as it sold 85.6 million American depositary shares at $19 apiece, at the top of the expected range.


By late afternoon, its stock was trading up $7.66 at $26.66 per share.

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By 2 p.m. in New York, the stock of Pinduoduo was at $26.66 per ADS, up more than 40 percent.

(Source: Thomson Reuters Eikon)

In its pre-IPO period, Pinduoduo briefly raised its offering price to $22.8 per ADS after its stock sale was oversubscribed 20-fold, according to local media. The 20 percent increase in pricing would have raised the valuation of the Facebook-Groupon mashup to $28.8 billion.

Since 2015, when an ex-Google engineer, Zheng (Colin) Huang, founded Pinduoduo, the company has grown rapidly, rivaling e-commerce giant Alibaba Group Holding Ltd. (NYSE: BABA) in China's smaller cities.

In the company's prospectus, Huang said the company strives to combine the principles of "Costco" and "Disneyland," bringing together value-for-money and entertainment, through a decentralized network and social interaction.

The company is backed by Chinese tech giant Tencent Holdings Ltd., which acted as one of the cornerstone investors in the IPO, committing $250 million.

Pinduoduo said it plans to use the proceeds from the IPO to expand its business operations, for research and development, and general purposes.


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