Hong Kong’s latest bubble tea IPO mints another billionaire.
China’s insatiable appetite for bubble tea has spawned another billionaire.
Guming Holdings Ltd.’s $233 million Hong Kong initial public offering bolstered the value of the stake owned by its millennial founder, Yun’an Wang, to $1.2 billion, according to the Bloomberg Billionaires Index. Shares were sold at HK$9.94 each in the IPO.
Wang joins the growing club of Chinese bubble tea billionaires who have sprouted in recent years amid soaring demand for the drinks—a $9.6 billion market in 2018 that’s forecast to balloon into $71 billion in three years. But he’s also taking his company public at a time investors are becoming increasingly wary about pumping money into such a competitive industry, where vendors regularly engage in price wars.
Take Sichuan Baicha Baidao Industrial Co., the maker of Chabaidao tea. It was the last firm concocting the drinks—made by mixing tea with fresh fruit, tapioca balls or milk—to list in Hong Kong. Its trading debut in April flopped and the stock has slid further since.
Source: FORTUNE