image credit: Bamboo Works
Key Takeaways:
Hong Kong IPO candidate TAILG's strong top- and bottom-line growth and $1.3 billion valuation could attract investors despite its operation in a crowded e-scooter market
The company derives the big majority of its sales from China, which could pose a challenge as the country rolls out tough new e-bike standards
In 2003, Shenzhen announced a ban on motorcycles to stop a crime wave of motorcycle-riding bandits. Three brothers, Sun Muqian, Sun Muchu, and Sun Muchai, together with partner Yao Li, were running a motorcycle repair shop in their hometown of Chaoshan at that time and saw an opportunity. They rented a small factory in Longgang, in the northeastern part of Shenzhen, and started making electric bicycles by hand, exploiting a loophole in the motorcycle ban.
Fast forward to the present, and the business they started, TAILG Technology Co. Ltd., is now China's third largest electric micromobility vehicle maker. It moved its headquarters from Shenzhen to Wuxi, about an hour by train from Shanghai, between 2007 and 2009, to better position itself geographically to build a national footprint.
Now, TAILG is about to take its show on the road one more time, this time to Hong Kong for a planned IPO, according to its listing application filed last week. The listing would make TAILG China's fourth e-scooter maker to go public, after Yadea (1585.HK), AIMA Technology (603529.SH) and Niu Technologies (NIU.US). Yadea was the leader with 26.8% of the domestic market in 2024, while AIMA was second with 17.9%. TAILG's 12.7% made it China's third largest brand, followed by Niu at 7.1%, according to TAILG's prospectus. Ninebot (68909.SH), owner of the Segway brand, is also a competitor.
TAILG's listing is being charged up by some big names, including Citic Securities and China Merchants Securities as its underwriters. Its investors include car giant SAIC, and a somewhat unlikely backer in luxury leader LVMH, whose participation comes through its L Catterton Asia Advisors joint venture. While scooters are hardly a luxury item, LVMH has a little experience in the space through a 2020 collaboration by its Dior brand with Italy's Piaggio (PIA.MI) to create a limited-edition Vespa 946 Christian ...
