Tencent increases its stake in Chinese grocery startup Xingsheng, sources say

Founded in 2009, Xingsheng is an online group-buying platform that allows users across 13 provinces in China to order online and pick up their goods in convenience stores in the neighborhood. The company is backed by the likes of KKR, Sequoia Capital, and Temasek Holdings, among others.

Xingsheng is also discussing potential fundraising plans with other investors including Beijing Kuaishou Technology, said the report.

The investment comes as the coronavirus pandemic has boosted online selling of fresh food and daily necessities. The company is on track to exploit China’s large online grocery market, which is poised to hit US$219 billion by 2026.

The move follows Chinese ecommerce giant JD.com’s investment of about US$700 million in Xingsheng last month.

See also: Kopi Kenangan saw explosive growth in 2019 – and stayed profitable

The report also noted that the current funding round could lead to an initial public offering. However, details regarding the timing and listing venue have not been confirmed.

In June 2020, Xingsheng raised an undisclosed amount from investors including Tencent and private equity giant Primavera Capital Group, lifting the Chinese grocery startup’s value to US$3 billion.