Meituan locked in super-apps battle
BEIJING/SHANGHAI: Meituan Dianping, which raised US$4.2 billion (RM17.3 billion) in its Hong Kong initial public offering (IPO), is one of China’s super-apps, with 340 million users ordering groceries, paying bills, renting bikes and booking hotels — but it is far from alone.
The delivery-to-ticketing platform, backed by Internet giant Tencent Holdings Ltd, is squaring off with Alibaba Group Holding Ltd-backed rivals, including Alipay, Ele.me and Koubei, as well as Tencent’s own WeChat.
This battle of the super-apps, which offer users a plethora of disparate services, creates a challenge for the company ahead of its public float this month.
On Thursday it set an aggressive valuation of US$52.8 billion.
To justify its price tag, Meituan will need to lure in cost-conscious consumers like Wu Lingli, 22, a student in Wuxi.
“Generally it’s all about price,” said Wu, who jumps between Meituan and rivals Ele.me, Didi, Taobao and others when shopping online.
Meituan has had to burn cash to keep ahead of rivals, both to subsidise shoppers and add new services.
Its wide variety of services has attracted users but crimped profits. The company lost US$3.33 billion in the first third of this year, despite a big jump in revenue. It lost US$2.8 billion last year.