Mogujie, the Chinese e-commerce developer of fashion app Mogu, reduced its target valuation to $2 billion in its IPO in the U.S., Bloomberg News reported Nov. 15, citing people familiar with the matter.
Sources reportedly said the move was due to the slump in market demand for technology stocks. Two of the people added that the value is about half of what the company had wanted in April.
The Tencent Holdings Ltd.-backed startup is still evaluating market conditions since more volatility will negatively affect its ability to reach its goal, sources reportedly said.
Mogujie, valued at $3 billion after it merged with rival Meilishuo in 2016, reportedly will push ahead with the IPO despite the move possibly undervaluing the company.
Mogu declined to comment on the matter, the report added.