Shares of the Chinese tea company Chagee surged by 30% during its debut on the public market on Thursday, as the firm plans to expand its operations to the U.S. despite ongoing trade tensions between Washington and Beijing.
The stock made its market entry on Nasdaq under the ticker “CHA,” opening at a price of $33.75 per share.
Chagee set the price for its initial public offering at $28 per share, which was at the high end of its anticipated range of $26 to $28. The company successfully sold 14.7 million shares, amassing $411 million and positioning its valuation at approximately $5 billion.
Since its establishment in 2017, Chagee has achieved significant growth, now operating over 6,400 teahouses in China, Malaysia, Singapore, and Thailand. According to regulatory documents, the company reported a net income of $344.5 million on revenues of $1.7 billion last year.
The company is also set to launch its first location in the United States later this spring at the Westfield Century City mall in Los Angeles.
Founded by Junjie Zhang, Chagee was inspired by the success of international coffee franchises. Notably, China is the second-largest market for Starbucks.
The timing of Chagee’s IPO comes amid a period of market volatility triggered by President Donald Trump’s imposition of new tariffs, which escalated tensions in the U.S.-China trade relationship. This environment has led other companies, including Klarna and StubHub, to postpone their public offerings following market downturns.
Additionally, recent trends indicate a decline in the popularity of U.S. listings for Chinese firms. From January 2023 to January 2024, the number of Chinese companies on the three largest U.S. exchanges dropped by 5%, according to findings from the U.S.-China Economic and Security Review Commission.
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