Chinese retail solutions startup DMall, backed by grocery chain Wumart Group, is considering a plan to file for an initial public offering (IPO), Bloomberg reported on Wednesday (Feb. 17), citing sources.
DMall is reportedly coordinating with advisors to launch an IPO in the second half of 2021, the sources told Bloomberg. The Beijing-headquartered startup could end up raising about $500 million if it moves forward with a public filing.
Wumart Group is also considering a public offering on the Hong Kong exchange that would be separate from DMall’s listing, the sources told Bloomberg.
Founded in 2015 by Feng Zhang, Jiangfeng Liu, Jie Lin, Wenzhi Li, Wenzhong Zhang and Xin Han, DMall offers tools to help retailers launch eCommerce operations. Since October, the company has worked with over 120 chain stores covering 13,000 storefronts. Aside from Wumart, DMall is also backed by Tencent, IDG Capital, Lenovo Capital and Incubator Group.
Wumart, also known as Wumei, is among China’s biggest retailers and the largest supermarket chain in the Beijing-Tianjin-Hebei area, according to the company website. The company runs in excess of 1,000 stores across the country.
More than half of economic retail growth in the U.S. during the pandemic has largely centered on eCommerce. Convenience is driving shopping behaviors, with more than 50 percent of those surveyed saying they would pay more to get what they need. Retail sales of consumer goods in China dropped 2.8 percent in May from a year before. eCommerce sales, however, escalated 22 percent.
As China started recovering economically from the pandemic, retail sales were seen as the main driver. Retail sales surged 4.3 percent in October; industrial growth was up 6.9 percent.
China said earlier this month that it has approximately 989 million internet users, up 85.4 million since March 2020. The China Internet Network Information Center (CNNIC) said China has been the world’s largest online retail market for eight years in a row.
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