Jingdong Mall: Back on the IPO Track? 京东商城上市：“狼”真要来了？

By newsdoug on May 31, 2012

After at least a month or 2 of silence from Jingdong Mall about its schizophrenic plans for a mega-IPO, the e-commerce giant that also goes by the name of 360Buy has suddenly vaulted back into the headlines with talk that it’s preparing a listing as soon as September. I honestly don’t know what to think of these latest reports anymore, as the company has sent so many contradictory signs on the IPO issue over the last year, with CEO Liu Qiangdong publicly denying plans for any such offering for at least a couple of years, even as unnamed people from the investment community say differently. I would have possibly have ignored these latest reports, except that they contain a level of detail that looks too deep to be purely gossip and speculation. (English article; Chinese article) According to one of the reports, Jingdong managers, including Liu Qiangdong himself, and their investment bankers met with analysts in Hong Kong earlier this week for 3 hours to discuss their plans, which include registration for a New York listing as early as June, followed by an actual IPO as soon as 3 months after that. Most of this news appears to be coming from analysts who attended the meeting, including one who said that Jingdong’s CFO was also present, as were representatives from major investment banks including Goldman Sachs (NYSE: GS), JPMorgan (NYSE: JPM) and CICC. During the meeting, Jingdong also reportedly made some of its first official disclosures about its sales, which apparently reached 21 billion yuan last year and are expected to more than double in 2012. There’s no mention of profits or losses, although most believe that Jingdong is losing big money due to a recent series of price wars with rivals like Alibaba’s TMall and Dangdang (NYSE: DANG). The report also discusses valuation, with 360Buy reportedly looking for a valuation of around $10 billion even though the investment banks said $6 billion is more realistic. This level of details leads me to believe that perhaps something is really happening, which would be consistent with some previous signals, and that we could actually see an IPO if the financial markets show even just a little improvement by this fall. If that happens, I would congratulate Jingdong for finally making up its mind after a past year of schizophrenic signals. As to whether anyone will want to buy into this offering, that’s a completely different story. I imagine that some investors will be tempted by the company’s position as China’s second largest e-commerce firm and big growth forecasts, but will no doubt be concerned about its losses. All that said, the offering could at least attract moderate interest, perhaps helping to breathe some life back into a moribund market for overseas Chinese listings.

Bottom line: The latest reports of an IPO as soon as September for e-commerce firm Jingdong Mall look like they may be credible, and could attract moderate investor interest.

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