English

By Fei Xie

Xiaomi released a public announcement revealing the situation of its initial public offering (IPO) lately. The announcement indicates that Xiaomi's retail subscriptions to its IPO have been oversubscribed by 9.5 times, and it only got 1.1 times in its international offering.

According to the announcement, Xiaomi received applications for more than 1billion shares, which is around 9.5 times the 109 million shares the company made available under its IPO in Hong Kong.

From the global perspective, the offering was faintly oversubscribed with some 2.4 billion shares allocated to international distributors, accounting for about 1.1 times that of the 23 billion shares for the total offering.

Xiaomi had set a price of HK$17 per share in the Asian financial hub in the beginning. However, Xiaomi ended the day at HK$16.80, down HK $0.20 from its IPO price of HK$17.00. The Xiaomi's market value is now around $50 billion, becoming the world's third largest listed maker of mobile devices but a far cry from the $100 billion touted last year.

Besides, the cornerstones investors' subscriptions are also settled. According to the Securities Times, the CICFH Entertainment Opportunity SPC subscribed 88 million shares, the CMC Concord subscribed 12 million shares, and the only company from a foreign country the Qualcomm Asia Pacific Pte. Ltd subscribed 46million shares.

Some business commentators pointed out that Xiaomi expected to raise up to $10 billion with an expected market valuation of $100 billion from its listing. When the announcement was released, the company said it could only bring in as much as $6.1 billion.

According to the company, the funds raised from the listing would be allocated to their operational plan. There is 30 percent of the total funds which would be used for research and development of their products, 30 percent of the funds would be apportioned to building the company's product chain ecosystem including funds for their AI products, 30 percent of the total capital would be appropriated to its global expansion, and the last 10 percent would be considered for the operational funds.