Mobile manufacturer, Xiaomi Corp, popular for its Mi brand smartphones, is gearing up for its first initial public offering. Sources have indicated that the company has selected international banks like Goldman Sachs Group and Morgan Stanley for this key milestone.
Moreover, it is also confirmed that Credit Suisse Group AG and Deutsche Bank AG are also chosen to work on this IPO. Sources say that the company is targeting a $100 billion valuation. The Chinese mobile manufacturer is still contemplating Chinese underwriters and has not decided on the timing and location of the sale of shares.
If the company attains the valuation, Xiaomi could be heading for the biggest IP since Alibaba’s $25 billion offering. This comes with a backdrop of a $45 billion valuation back in 2014. Things were not very positive for the smartphone maker as it had an absolutely terrible 2016. However, it brought about changes in the sales model and pushed lot of its phones in the Indian market, which previously had Samsung as the biggest market share holder. Surprising everyone, the company achieved its annual target of $15 billion by October 2017.
Lots of speculation is happening around this IPO. Representatives from Xiaomi, Goldman Sachs, Credit Suisse, Morgan Stanley, and Deutsche Bank refused to comment on this development.
As soon as this news broke, stock prices of competing firms like Lenovo Group and ZTE Corp dropped by 1.8 percent and 2.4 percent, respectively.
The company has achieved tremendous milestones in developing countries, and now it is looking forward to entering developed markets, under the guidance and leadership of Chairman and Co-Founder, Lei Jun. Xiaomi has also made inroads in countries like Spain, and sources have indicated that they will initiate discussions with U.S carriers to push their devices in a market dominated by Apple Inc.
Furthermore, the company has not just limited itself to the smartphone business. It has also backed many startup ventures who are manufacturing a bundle of products, from wearable devices to rice cookers. As a result, the total revenue generated from the ecosystem increased by two folds and reached 20 billion yuan in 2017. Moreover, the company also takes a good share in partner sales on the Mi brand.
Lei Jun indicated that the company has an ambitious plan to open its own retail store network – which will include around 1000 “Mi Home” stores by the year 2019.