Energy Monster IPO: Chinese power bank rental firm bucks sharing economy bust with expansion initiative

Energy Monster is China’s largest mobile device charging service provider by gross revenue in 2020, with a 34 per cent market share and 219.4 million users

The size of China’s mobile device charging services market is forecast to reach US$16.3 billion in 2028

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Chinese power bank rental firm Energy Monster has applied to go public on the Nasdaq stock market. Photo: Handout

Published: 10:00pm, 15 Mar 2021Updated: 10:20pm, 15 Mar 2021

Power bank rental company Energy Monster plans to expand its mobile device charging services operation in China, as it pursues an initial public offering in the US amid the strong recovery in the world’s second-largest economy and biggest smartphone market.

Shanghai-based Energy Monster, through holding company Smart Share Global, filed its application to go public on the Nasdaq stock market on Friday to the US Securities and Exchange Commission. The firm did not provide the amount it plans to raise from the IPO, according to its prospectus.

Founded in 2017 amid the rush of money into China’s sharing economy, Energy Monster has emerged as the country’s largest mobile device charging service provider in terms of gross revenue in 2020, with a 34 per cent market share, according to data from iResearch that was cited in its prospectus. The company, with revenue of 2.8 billion yuan (U$430 million) in 2020, had 219.4 million registered users at the end of last year and a network of more than 664,000 power bank rental locations across the country.

Energy Monster said its planned IPO shows that there are “ample opportunities” for service providers to grow in China’s power bank sharing sector. Power banks are not new in China and are easily affordable for many as a device costs less than 100 yuan. But the increasing use of smartphones in almost every facet of people’s daily lives in the country – from hailing cars and shopping online to paying for purchases at convenience stores and sharing videos on social media – has made power bank rentals a lucrative business.

Shared power banks have found success in China with start-ups such as Energy Monster attracting investment from the likes of SoftBank Ventures Asia, Hillhouse Capital and Alibaba Group Holding. Photo: Shutterstock

Citing iResearch data, Energy Monster said the size of China’s mobile device charging services market is forecast to reach 106.3 billion yuan in 2028, up from 9 billion yuan in 2020. That demand will be fuelled by pervasive smartphone usage, dependence on mobile apps and the adoption of 5G mobile technology, according to its prospectus.

“The prevalent low-battery anxiety is the biggest pain point nowadays,” said Shanghai-based independent analyst Zhang Kun. He indicated that the rise of compelling apps, such as those for short video-sharing, has contributed to the demand for a quick smartphone or tablet charge anywhere people go in the country with the world’s biggest internet population.