Chinese digital platform Qifa delays Moscow IPO as high interests rates bite

Qifa, which focuses on trade between Russia and China, had planned to raise US$18.9 million from its listing in Moscow

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A pedestrian stands in front of an office of the Moscow Exchange, Russia’s leading financial marketplace, on August 5, 2024. Photo: Reuters

Published: 2:56pm, 3 Sep 2024

Digital platform Qifa, which focuses on trade between Russia and China, has delayed its initial public offering (IPO) on the Moscow Exchange owing to high interest rates and a challenging business environment in the world’s ninth most populous country, according to company founder Sun Tianshu.

Sun on Tuesday said the 1.7-billion-rouble (US$18.9 million) IPO in Moscow had been planned initially in August, with the goal of selling around 20 per cent of Qifa’s shares.

“Now, it’s October or November. That’s after the key interest rate hike and as the general environment on the stock exchange became more difficult,” Sun told Reuters on the sidelines of Russia’s Eastern Economic Forum in Vladivostok. “So, for our future investors, we decided to postpone it.”

According to Qifa, its revenue jumped 75 per cent year on year to 5.7 billion roubles in 2023. Sales of consumer goods, such as shoes and clothes, accounted for the bulk of revenue.

Information banners are on display in Vladivostok, Russia, for the Eastern Economic Forum, which runs from September 3 to 6, 2024. Photo: Reuters

Russia’s central bank hiked its key interest rate by 200 basis points to 18 per cent in July, the highest level in more than two years, and vowed to continue tightening until inflation rates in an overheated economy come down.