Dada eyes Nasdaq listing as delivery demand booms
JD-backed on-demand retail and delivery platform Dada Group has filed for Nasdaq listing and aims to raise up to US$100 million.
The Shanghai-headquartered platform is partnering with major supermarket chains including Walmart, Yonghui, CR Vanguard and other offline merchants.
Goldman Sachs, BofA Securities and Jefferies are joint bookrunners on the deal. An offering price has not yet been disclosed.
Revenue of Dada more than doubled in the first quarter to 1.099 billion yuan (US$154.8 million), from 526.5 million yuan a year earlier. Net losses lowered to 279.3 million yuan in the quarter, compared with 336.9 million yuan a year ago.
The delivery platform Dada Now was set up in 2014 and merged with JD Daojia in 2016 to offer local on-demand retail service.
In the 12 months ending in March this year, Dada's more than 634,000 delivery personnel fulfilled 822 million orders.
Digital services have been a focal point of China's economic recovery and delivery services also saw exponential growth during quarantine periods earlier this year.
JD Daojia's gross merchandising volume in the 12 months ended March jumped 92 percent from a year earlier to 15.7 billion yuan, generated from 134.7 million orders by 27.6 million active consumers during the period.
Local consultancy iResearch expects gross merchandising volume for on-demand retail platforms in the supermarket segment to grow to 385.4 billion yuan by 2023, representing a compound annual growth rate of 69.5 percent from 2019.
JD Group and Walmart Group hold 47.4 percent and 9.9 percent equity interests in Dada Group.
Research consultancy iiMedia expects the user base for on-demand delivery service to climb to 482 million this year, as demand has expanded to not only food takeaway but also daily necessities such as consumer goods, health-care and personal-care products.
It also suggests that expansion into lower-tier cities and carefully targeting local demand would be crucial for future development, and quality service will also be a focus for future competition.