Sep 25, 2020 08:23 PM

Chinese Muji Lookalike Files for U.S. IPO

Tencent-backed variety store chain MINISO Group Holdings Ltd., China’s cheaper alternative to Japanese retail brand Muji, filed an IPO prospectus to the U.S. Securities and Exchange Commission on Thursday.

Founded in 2013, the Guangzhou-based company sells products with a strong Japanese design influence ranging from cosmetics and textiles to toys and snacks. Just how much inspiration Miniso has drawn from established Japanese brands has seen it labelled a “copycat,” and the planned U.S. listing could earn comparisons to Chinese e-commerce site Pinduoduo, which faced criticism for selling knock-off goods as it prepared to go public on the Nasdaq in mid-2018. Pinduoduo now has a market cap more than twice the size of Baidu Inc.

Miniso charts-1

It is eyeing an IPO on the New York Stock Exchange, underwritten by Goldman Sachs Group, Inc. and BofA Securities Inc. The prospectus did not disclose pricing details.

In 2018, tech giant Tencent Holdings Ltd. and equity firm Hillhouse Capital Group poured a combined 1 billion yuan ($146.5 million) into the company, giving each a 5.4% share in the company. Founder Ye Guofu remains the biggest shareholder Ye holds more than an 80% stake.

Taking advantage of China’s cheap labor force in the populous Pearl River Delta and Yangtze River Delta regions, Miniso sold 95% of its products for less than 50 yuan ($7.30) in the July 2019 to June 2020 fiscal year, according to the prospectus.

Ye said in April that the Covid-19 pandemic had led the company to lower its prices even further, aiming for 90% of its products to be sold for under 30 yuan ($4.40) in the future.

Miniso charts-2

“As a country with full industrial chain, China’s biggest strength is low-cost manufacturing, and the core part of discount retailer’s business is low cost and cheap prices,” Ye told Caixin in April, adding that “the economic downturn is the best time for discount retailers to rise.”

Miniso had over 4,200 stores around the world as of June 30 this year, just 129 of which it directly operates. The rest are run on a franchise basis. It operates seven of China’s 2,500 stores and 122 overseas, with another 1,500 franchise stores in some 80 countries, including the U.S., Canada and Mexico. Each franchise store pays the company 80,000 yuan per year and contributes 62% of their daily revenue to the company in order to use the brand, according to Miniso’s website.

Miniso posted a 4.4% year-on-year decline in revenue to 9 billion yuan for the fiscal year ending June 30, as stores across the world were shut down amid the pandemic, although it was able to cut its losses from 299 million to 262 million yuan.

Contact reporter Lu Yutong ( and editor Gavin Cross (

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