Shares in the Chinese online retailer JD.com jumped 10 percent in their Nasdaq stock market debut.
The stock, which is traded under the symbol JD, ended at $20.9, after being priced at $19 at the start of trading on Thursday.
The company said that it raised $1.8bn (£1.1bn) after selling 69 million shares, valuing the company at more than $25bn.
JD.com is China's second largest e-commerce firm after Alibaba, which owns Taobao and Tmall and is set to go public later this year.
JD.com plans to use proceeds from the IPO to expand its infrastructure, building new warehouses and establishing extra delivery stations. As Quartz's Gwynn Guilford explains, the two company's are now in a competition for "a huge emerging market: poorer, inland China":
That’s probably why JD.com plans to spend up to $1.2 billion of its new capital on building its delivery infrastructure further into China’s backcountry—a plan that could mean it takes years before the company turns a profit. Investors don’t seem too worried; JD.com just raised $1.78 billion.
Investors will probably feel even more confident in China’s online retail outlook when Alibaba lists publicly (it filed initial paperwork with the US securities regulator on May 7). JD.com’s heady valuation suggests that Alibaba, which has long been profitable, will be worth even more than many imagined—perhaps as high as $200 billion (more than Facebook). What they might not realize is that the business models that they’re banking were built for the swath of China that’s now essentially a middle-income country. Whether those models will work as smoothly and cheaply in the emerging market that is the rest of China is an open question.
[Image via Forbes]
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