The logistics arm of JD.com (Nasdaq: JD; HKEX: 9618) has filed a prospectus to launch its IPO process in Hong Kong. The company aims to become the second subsidiary of JD.com to go public in the city after JD Health.
JD Logistics is targeting a valuation of $40 billion. JD.com will remain a majority shareholder and will realize value from the business in the listing, the company said in a regulatory filing.
According to the prospectus, JD Logistics provided services to more than 190,000 corporate customers in 2020, covering consumer goods, clothing, home appliances, furniture, autos, and fresh foods. According to the CIC report, JD Logistics was the largest integrated supply chain logistics service provider in China in terms of total revenue in 2019.
The company expects to use the IPO funds to upgrade and expand its logistics network and develop advanced technologies related to supply chain solutions and logistics services, the prospectus said.
Over the past several months, JD.com has been a frequent guest with the Stock Exchange of Hong Kong. In June 2020, the e-commerce giant raised $4.4 billion in the largest secondary listing of that year in the city. Then, its health unit, JD Health (HKEX: 6618), conducted the largest IPO of that year, raising $3.48 billion.
In 2017, JD Logistics was spun off by its parent to become an independent business and introduced delivery and warehouse services to third-party firms.
China's e-commerce sales have surged during the pandemic, which led to increased investor interest in shipping and delivery providers, Elysia Tse, head of Asia Pacific research and strategy at LaSalle Investment Management, said in an interview with Bloomberg Television earlier this month.
At the close of trading in Hong Kong, JD.com ended 1% higher, at HK$391.60 per share. In New York on Tuesday, the company was trading up 4% intraday, at $103.50 per share.