Chinese retailer MINISO has filed an application to list on the Hong Kong stock exchange, becoming another Chinese company seeking a dual primary listing in Hong Kong as they could be delisted from US exchanges.

The Guangzhou-based retailer has filed its application to the Hong Kong Stock Exchange on 31 March. In October 2020, it raised US$608 million from an initial public offering in New York. In its application proof , MINISO said its revenue from markets outside of China was ¥1,780.5 million (US$279.4 million) and ¥1,340.6 million (US$210.4 million) in the fiscal years ended on June 2021 and the six months ended on 31 December 2021, accounting for 19.6% and 24.7% of its total revenue for the same periods.

The company also mentioned several factors that could risk its international operations, including wars, political and economic instability; trade restrictions; and tariffs and customs duties and the classifications of our goods by applicable governmental bodies.

"A number of factors could have an adverse impact on our operating results if our efforts to expand internationally are not  successful. These factors include changes in market needs and product trends, economic fluctuations, political and social turbulence, relevant countries or regions’ relationships with China, changes in legal regulations or other conditions and difficulties in employing and training appropriate management and local employees," the company said.

It cited the example of the escalation of tensions between China and India, which resulted in a number of mobile apps developed by Chinese companies and operated in India being banned by the Indian government.

"We are unable to predict how international relations between China and India will develop, and what measures the India government will take towards products and services provided by and business operations of Chinese companies in India. There can be no assurance that we will not be targeted or affected by similar actions in the future," the company added.

MINISO said it started operating its first store in China in 2013 with two brands MINISO and TOP TOY. In 2021, the aggregate gross merchandise volume (GMV) of products sold through our MINISO network reached approximately ¥18.0 billion (US$2.8 billion). As of December 31, 2021, MINISO served consumers primarily through a network of over 5,000 MINISO stores, including over 3,100  MINISO stores in China and about 1,900 MINISO stores overseas. The company's footprint spans more than 100 countries and regions too.

Last year, in an interview with MARKETING-INTERACTIVE, Robin Liu, vice president, CMO and head of eCommerce  shared that while many retailers struggled to keep their operations afloat, MINISO exploded across the globe and set up its presence in all corners of the world. Here in Asia, given its role as the region’s economic hub and its wide influence across the markets, Singapore is today one of MINISO’s more developed and key markets in Southeast Asia. Closely following in presence is Indonesia, due to its large population and the maturation of eCommerce.

Currently, in Asia, MINISO localises much of its products to fit the culture and nuances. For example, given a large number of its Indonesian customers are Muslim, the company has adapted its beauty line to be more flexible to their religious customs. Since Muslims cannot wear makeup during worship, the company has developed a peelable nail polish so that customers can be stylish during their daily lives and also easily remove their nail polish quickly and easily for worship.

“It’s a subtle yet impactful localisation,” said Liu. But the challenges across Southeast Asia are many.

Southeast Asia is a fragmented market composed of markets with different levels of economic development and expendable income levels, cultural and religious customs and taboos. Collectively, these naturally lead to more dynamic consumer behaviour trends and present a big adaptability and localisation challenge for brands such as MINISO which are rapidly expanding to serve the local customers.

Related article:
Interview: MINISO might ‘think small’ but markets big

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