Xiaomi and Meituan-Dianping, which were crowned unicorn status while they were private, are not performing as well now that they are listed as public companies. They join a sizable list of other China-based unicorns that have seen declines in recent months since listing on U.S. exchanges.
Xiaomi, China’s affordable smartphone and internet of things device manufacturer, raised a known total of $3.4 billion (inclusive of debt) as a private company and was valued at $46 billion in 2014. The company, which was known for walking a fine line on IP regulations and very slim margins on its smartphones, eyed an IPO valuation of $100 billion.
After scaling back its original goal and then pricing at the bottom end of its HK$17- HK$22 range, Xiaomi made $4.7 billion in it’s IPO and was valued at $54 billion, just over half of that earlier goal. Since then its stock has declined. At its last close, the company hit an all-time low. Its market cap declined to HK$263.255 billion or about $33.6 billion.
Similarly, Meituan-Dianping, China’s online-to-offline (O2O) retail company that emerged out of the Groupon craze in the early 2010s, went public in September. The conglomerate raised a known total of $7.3 billion from investors including Booking Holdings, Tencent, China Resources, and Temasek, and reached a valuation of $30 billion before going public.
Meituan-Dianping priced at the upper half of its share price range at HK$69 (about $8.79), raising $4.2 billion in its IPO and reaching a valuation of $53 billion. Notably, the company was reported to have originally targeted a $6 billion raise in its IPO, but lack of profitability may have affected that goal.