Xiaomi to launch IPO in Hong Kong

China smartphone maker Xiaomi has delivered an application to Hong Kong Exchanges & Clearing Limited for an IPO.

With an estimated value of 70 billion US dollars, Xiaomi is expected to complete the largest IPO worldwide this year, or the 15th biggest of all time.

Xiaomi CEO Lei Jun introduces Surge S1 chipset, Mi 5C smartphone and Redmi 4X smartphone during a press conference on February 28, 2017 in Beijing, China. [Photo: VCG]

It reached annual revenue of 114.6 billion yuan (18 US dollars) last year, up 67.5% year-on-year. 70.3% of the revenue comes from selling smartphones at a razor thin profit margin. The company's operating profit stood at 12.2 billion yuan in 2017, an increase of 222.7% compared to the year before.

Xiaomi CEO Lei Jun promised to control the net profit ratio of the company's hardware business (smartphone and IoT) below 5%. Once surpassing that benchmark, the overage will be returned to customers.

Founded in 2010 in Beijing, Xiaomi has become the world's fourth biggest smartphone maker, with 190 million monthly active users.