(Yicai) March 3 -- Mixue Group’s shares surged on their first day of trading after China’s biggest operator of ice cream and bubble tea stores raised the most ever for an initial public offering in Hong Kong.

Mixue [HKG: 2097] closed 43 percent higher at HKD288 (USD37.03) a share today, giving the Zhengzhou-based company a market capitalization of HKD110.6 billion (USD14.2 billion). The 17 million shares, which were sold at HKD202.50 each, opened at HKD262.

The IPO was oversubscribed by 5,258 times, grossing HKD3.5 billion (USD450 million) and netting HKD3.3 billion, according to a Feb. 28 stock exchange filing. The enthusiastic response to its share sale was fueled by the reforms to Hong Kong's IPO system introduced in November 2023, as well as Mixue's leading position in China's competitive tea market.

Mixue was the world’s largest food and beverage company by store count as of Dec. 31, with 46,479 in 11 countries, making it bigger than Starbucks and McDonald’s. In the first nine months of last year, the company had a net profit of CNY3.5 billion (USD482.2 million) on revenue of CNY15.4 billion (USD2.2 billion).

In the past three years, Mixue’s retail sales soared 90 percent to CNY58.3 billion (USD8 billion), with the number of cups sold reaching nine billion last year.

The IPO’s cornerstone investors were M&G Investments, HongShan Growth, Boyu Capital Investment Management’s Persistence Growth, Hillhouse Group’s HHLR Fund, and Meituan’s Long-Z Fund.

About two-thirds of the proceeds will be used to expand Mixue’s global footprint, it has said. Twelve percent will go toward building its brand and intellectual property and another 12 percent is earmarked to strengthen its digital and smart capabilities across the business. The rest will be used to supplement working capital and for other general business purposes.

Editor: Futura Costaglione