Xiaohongshu targets $70B valuation in Hong Kong IPO push

Chinese social media platform Xiaohongshu, also known as RedNote, is getting ready for an IPO in Hong Kong valued at over $70 billion. This will be one of the city’s biggest tech listings and a pivotal moment in the revival of Chinese technology firms making their way back to the public domain after retreating from the market due to regulation for several years.

The listing could reshape how global investors price Chinese consumer technology at a time when Beijing is loosening its grip on the sector, and Hong Kong is reclaiming its role as a capital markets hub. IPOs in the city have already raised more than HK$140 billion ($22.8 billion) in 2026, according to Hong Kong Financial Secretary Paul Chan, keeping it atop global rankings for listing volumes.

Goldman Sachs and CICC tapped as advisers

Xiaohongshu has reportedly hired Goldman Sachs and China International Capital Corp to work on the potential offering. The company could list as early as the second half of this year, though the IPO size and final valuation have not been set.

Major investors are pushing for a valuation above $70 billion, a steep jump from the roughly $50 billion implied by recent private secondary share transactions. That pricing is a remarkable turnaround since Xiaohongshu’s valuation stood at $20 billion in 2021 but had reportedly plunged to $17 billion in 2024 before rebounding sharply.

Profit growth underpins the valuation demands

The company’s financials account for the excitement of investors. According to reports, Xiaohongshu might earn more than $3 billion by 2026 from a net income of more than $2 billion last year. This is a swift increase in profit following its very first profit of $500 million out of $3.7 billion total income in 2023.

Founded in 2013, Xiaohongshu started as an app that provided shopping tips for Chinese customers purchasing foreign goods. It later developed into a lifestyle app that has more than 400 million monthly active users creating content on fashion, travel, cuisine, and daily life while merging social media with online shopping, an approach likened to that used by Instagram.

The app received unexpected popularity among foreigners in early 2025 after many Americans shifted to RedNote amid speculation over the future of TikTok in the country.

A test case on the revival of IPO listing in Hong Kong

The listing of Xiaohongshu will happen in a crucial period in the history of Hong Kong’s IPO market. 2025 saw the peak number of IPOs being listed on HKEX over the last four years, and the trend continued in 2026. This put the HKEX under increased scrutiny by the Hong Kong Securities and Futures Commission as well as the Chinese authorities.

China Securities Regulatory Commission must first approve Xiaohongshu’s application, which will require a few months, according to Reuters. In 2021, Xiaohongshu initiated the process of confidentially filing for an IPO in the U.S. However, the process was disrupted because the Chinese government did not approve of the listing venue due to geopolitical tension with the West over data privacy and offshore listings.

The situation has since evolved. With Chinese tech firms increasingly looking for other ways of going public, they have started listing their stocks in Hong Kong instead of New York due to regulatory issues and geopolitical conflict.

Upcoming challenges and risks

Xiaohongshu will have tough competition within the digital advertisement sector in China, where it faces competition from Douyin by ByteDance in terms of cost of advertising and customers. Further, regulations on data privacy and political tensions continue to hinder its expansion beyond mainland China.

Nevertheless, Xiaohongshu’s successful listing would generate funds to allow for its further development while providing an excellent chance for global investors to invest in one of China’s fastest-growing consumer platforms at public market prices.

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