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Dmall Inc. (02586.HK)

Subscription Period: November 28 to December 3, 09:30

Offer Price: HKD 30.21

Entry Fee: HKD 3051.50 per lot of 100 shares

Joint Sponsors: CCB International, and CITIC Securities acting as joint sponsors.

Expected Listing Date: December 6

Dmall Inc. (02586.HK) will launch its initial public offering (IPO) from November 28 to December 3, 2023. The company intends to offer a total of 25.774 million H-shares globally, with 10% of these shares available for public offering in Hong Kong and the remaining 90% allocated for international placement. The shares will be priced at HKD 30.21 each, with a minimum lot size of 100 shares, resulting in an entry fee of approximately HKD 3051.50. The company aims to raise up to HKD 780 million. Dmall Inc. is expected to list on December 6, 2023, with UBS, CCB International, and CITIC Securities acting as joint sponsors.

Company Overview

Founded in 2015 and led by Zhang Wen Zhong, the renowned "Father of Chinese Supermarkets" and owner of Wumart Group, Dmall Inc. is a leading provider of digital solutions to the Chinese retail sector. The company offers a variety of products, including its Retail Core Services Cloud and E-commerce Services Cloud, which assist retailers in achieving digital transformation and enhancing operational efficiency. Dmall Inc.'s solutions cover a wide range of retail functions, including procurement, supply chain management, store operations, marketing, and omnichannel sales. The company is committed to improving the efficiency of retail operations, reducing costs, and enhancing customer experiences.

According to data from Frost & Sullivan, Dmall Inc. was the largest provider of retail cloud solutions in China by revenue in 2023, with a market share of 6.5%. It was also the third-largest provider of retail digitalization solutions in Asia, holding a market share of 4.2%. The company has successfully expanded its digital retail services to several countries and regions across Asia, including Hong Kong, Cambodia, Singapore, Malaysia, Indonesia, the Philippines, and Brunei, and is now entering the European market through a partnership with Metro Group.

Financial Performance

From 2021 to 2023, and in the first half of 2024, Dmall Inc. reported revenues of RMB 848 million, RMB 1.328 billion, RMB 1.585 billion, and RMB 939 million, respectively. The company recorded net losses of RMB 1.808 billion, RMB 900 million, RMB 749 million, and RMB 482 million during these periods. The adjusted net losses were RMB 942 million, RMB 356 million, RMB 233 million, and RMB 56 million, respectively.

Despite experiencing losses over the years, Dmall Inc. has indicated in its IPO prospectus that its net losses have consistently narrowed. This improvement is primarily attributed to enhancements in the gross margins associated with its Retail Core Services Cloud solutions, as well as reductions in sales and marketing expenses and improvements in operational efficiency.

The net proceeds from the IPO are expected to be allocated as follows: 42% for the development of new applications and service modules; 30% for talent recruitment to support business expansion; 10% for selective strategic partnerships, investments, and acquisitions that complement its organic growth strategy; 7.9% for expanding its sales network and enhancing its brand reputation; and 10% for working capital and general corporate purposes.

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✅ IPO financing 0%* 

✅ 15x purchasing power^