Chinese Vaping Device Maker Smoore Files For HK IPO Amid Industry Scrutiny

Chinese vaping device manufacturer Smoore has filed for an initial public offering (IPO) in Hong Kong on late Thursday, less than two months after the country’s regulator urged merchants to stop selling and advertising electronic cigarettes online out of juvenile protection.

Smoore, the world’s largest vaping device maker in terms of revenue in 2018, is yet to reveal the pricing terms and size of the listing. The prospectus it filed with the stock exchange was heavily redacted.

Smoore was set up in 2006 to research, design and manufacture closed system vaping devices and components for tobacco companies and vaping companies worldwide, such as Japan Tobacco, British American Tobacco, Reynolds Asia Pacific, Chinese e-cigarette brand RELX and America’s NJOY.

The company also offers open-system vaping devices, or APVs, as well as components and accessories for retail clients under self-owned brands: Vaporesso, Renova, and Revenant Vape. The company noted in the prospectus that it did not operate any retail stores or online platforms for the sale of self-branded e-cigarette products. All self-branded products were sold to distributors.

Proceeds from the IPO will be used to expand production capacity, including the establishment of industrial parks in southern China’s Jiangmen and Shenzhen city. The company also plans to use the capital to implement automated production and assembly lines at new production bases.

In December 2015, Smoore went public on the National Equities Exchange and Quotations (NEEQ), an over-the-counter market in mainland China known as “the new third board.”

The company was delisted from the bourse on June 5, 2019, due to “consideration of the capital market development and the firm’s business development plan,” Smoore disclosed in a filing with the domestic stock exchange on June 4.

The IPO application comes on the heels of Beijing’s starkest warning yet on the country’s nascent e-cigarette industry, which is growing in a market that hosts over 300 million smokers, according to the World Health Organization.

China’s tobacco regulator issued a notice on November 1, asking e-commerce platforms to close all online stores that offer e-cigarette products in order to “further strengthen the protection of the physical and mental health of minors.”