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Using Apple and Tencent to Value Xiaomi

Technology giants offer some context for investors trying to determine its IPO valuation

Its been less than a week since investors got their hands on Xiaomi Corp.’s 597-page filing for an initial public offering, but doubts over the smartphone maker’s lofty valuation figures have already begun percolating. Estimates have ranged from as low as $30 billion to more than $100 billion, although people familiar with the matter have said the valuation would be more likely to start around $60 billion to $70 billion. Some investors may want to look to Tencent Holdings Ltd. or Apple Inc. for additional guidance. Applying the duo’s 2017 price-to-sales multiples to Xiaomi would net a valuation range of $62 billion to $250 billion.

— With assistance by Matt Turner

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