2 weeks Ago
NEW YORK, April 18 – Chinese entrepreneur Zhang Junjie has reportedly become a billionaire after his tea shop chain, Chagee Holdings Ltd, raised US$411 million (RM1.96 billion) in its Nasdaq debut, Bloomberg reported.The listing, which priced at the top of its range, gives the 30-year-old Zhang a US$1.
8 billion (RM8.6 billion) fortune based on his stake in the company, according to the Bloomberg Billionaires Index.Zhang founded Chagee in 2017 in China’s Yunnan province and serves as the company’s chief executive officer.
Chagee’s focus on premium milk-based teas made from traditional Chinese blends such as green, black and oolong has helped it stand out in a bubble tea market dominated by sugary drinks.The company operates more than 6,440 outlets, mostly in China, with additional locations including in Malaysia, Singapore, and Thailand.Chagee’s strategy contrasts with other Chinese tea chains like Mixue Group, whose founders became billionaires after its Hong Kong listing but whose IPO also highlighted an increasingly saturated market.
Analysts say that Chagee’s US listing reflects limited options elsewhere, especially with investor fatigue and falling valuations in Hong Kong.“The scale of capital focused on new tea beverages has declined, meaning that a Hong Kong IPO would likely struggle to deliver strong results in terms of valuation and fundraising size.“For Chagee to achieve securitisation, the US stock market is now virtually the only viable option,” Shen Meng, a director at Beijing-based investment bank Chanson & Co, was quoted telling Bloomberg.
This comes as in Malaysia, Chagee had faced a backlash after its app showed Beijing’s controversial nine-dash line, while in Vietnam, authorities are investigating a similar issue ahead of the company’s market entry.Recommended read:From Mixue to Chagee, how Chinese milk tea chains are now outpacing Taiwanese and local brands.
