Logistics company J&T Global Express Ltd has made its debut on the main board of the Hong Kong Stock Exchange after successfully completing the second-largest initial public offering (IPO) in the city this year. Through this IPO, the company's founder, Jet Lee, has become a new billionaire with a wealth of approximately US$1.5 billion according to the Bloomberg Billionaires Index.

As the trading session began, J&T's stock price increased by 0.17% to HK$12.02 per share on Friday morning (27/10). The courier company provides delivery services for various leading online stores such as Shein, Pinduoduo, and Shopee, and it raised approximately US$500 million or around IDR 7.95 trillion through this IPO.

Jet Lee, who owns 11% of the shares in J&T, is one of the new Chinese billionaires who have emerged from the online shopping boom of the last two decades. According to Bloomberg reports, Jet Lee founded J&T after spending more than 15 years at the Chinese smartphone manufacturer OPPO and played a role in developing the company's operations in Southeast Asia.

After establishing J&T in Jakarta in 2015, the company grew rapidly and expanded throughout Southeast Asia. In 2020, J&T entered the Chinese market. According to their IPO prospectus, in 2022, J&T had a dominant market share of over 20% in the express delivery industry in Southeast Asia.

This rapid expansion has attracted the attention of several prominent investors, including Tencent Holdings Ltd, SF Express, Sequoia Capital, and OPPO. Additionally, J&T's presence in China continues to grow, with more than half of the company's total revenue of $7.3 billion in 2022 coming from its business in the country, surpassing Southeast Asia as its largest market.

Despite the attractiveness of J&T's expansion in mainland China, some, such as Wang Ting, an analyst at Essence Securities, have pointed out that the low-cost strategy they employ may be challenging to sustain in the medium and long term.

According to the company's prospectus, J&T reported an adjusted loss of $1.5 billion in the previous year and only recorded profits in Southeast Asia. The company also expanded its operations to the United Arab Emirates, Saudi Arabia, Mexico, Brazil, and Egypt in 2022, bringing the total number of countries where J&T Express operates to 13. The previous year, the company also appointed soccer star Lionel Messi as their brand ambassador.

Although J&T Global Express's IPO was the second-largest in Hong Kong this year, there are still some issues to be aware of, including potential regulatory violations in Indonesia. This relates to the use of contract arrangement agreements with the parent company in Indonesia and its affiliates, which allow the company to have full control over its business entities in Indonesia through nominees. On the other hand, the Investment Law No. 25 of 2007 limits foreign ownership of courier service companies to a maximum of 49%.