People are shopping at a CHAGEE store in Shanghai, China, on October 18, 2023.
Costfoto | Nurphoto | Getty Images
Shares of Chinese tea chain Chagee soared more than 40% during its public market debut on Thursday morning, as the company plans a U.S. launch despite trade tensions between Washington and Beijing.
The stock, which is trading on the Nasdaq using the ticker “CHA,” opened at $33.75 per share.
The company priced its initial public offering at $28 per share on Wednesday, on the high end of its expected range of $26 to $28. Chagee sold 14.7 million shares, raising $411 million and valuing the company at roughly $5 billion.
Since its founding in 2017, the company has grown to more than 6,400 teahouses across China, Malaysia, Singapore and Thailand. Last year, Chagee generated net income of $344.5 million from revenue of $1.7 billion, according to regulatory filings.
The company is preparing to open its first U.S. location later this spring at the Westfield Century City mall in Los Angeles.
Founder and CEO Junjie Zhang created the chain after being inspired by the success of international coffee companies. China is Starbucks’ second-largest market.
Chagee’s IPO follows several weeks of market turmoil after President Donald Trump imposed new tariffs and ignited a trade war with China. Other IPO hopefuls, including Klarna and StubHub, delayed their plans to go public after markets plunged.
In recent years, it has also become less popular for Chinese companies to list on U.S. exchanges. From January 2023 to January 2024, the number of Chinese companies listed on the three largest U.S. exchanges fell 5%, according to the U.S.-China Economic and Security Review Commission.
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