Depth report

　　

Levi Strauss fired the starting gun to return to the US stock market, hoping that investors will put a price tag of about $5 billion on the blue jeans inventor, despite the fierce competition in the clothing market.

    The San Francisco-based company announced plans on Wednesday to list on the New York Stock Exchange under the ticker symbol LEVI, so that it will return to the public market 34 years after being privately owned.

    This move means that the group will join other companies that plan to conduct an initial public offering (IPO) this year, including Uber, Lyft and Airbnb. Levi did not confirm the fundraising goal of the listing. People familiar with the matter have previously stated that the group plans to raise between US$600 million and US$800 million from investors, bringing its valuation to more than US$5 billion.

    The company said that the proceeds from the listing will be used to increase "financial flexibility for general corporate purposes, including working capital, operating expenses and capital expenditures."

    As Levi plans to go public, the rise of online shopping and changing customer tastes are disrupting the retail industry. Consumers are buying more sportswear, and this trend is called "sports and leisure." In a filing with the U.S. Securities and Exchange Commission (SEC), Levi tried to convince Wall Street that it could succeed in the ever-changing market landscape-emphasizing its foray into "omni-channel" retail, combining physical and online businesses.

    "Although e-commerce still accounts for only a small part of our net revenue, it has been our fastest growing business in the past few years," the company said in its filing. The wholesale channel generated nearly two-thirds of net revenue last year.

    In physical stores, Levi introduced a method for customers to customize their jeans. Other initiatives include launching new styles (such as men's tapered jeans), co-branding models with celebrities such as singer Justin Timberlake, and breaking into categories such as tops and women's clothing. The company's products are sold in more than 50,000 outlets and recently opened a 17,000 square foot store in Times Square, New York.

    The descendants of Levi Strauss, the German immigrant who founded the company that year, retain control through Class B shares. They listed the company in 1971 before taking it into private ownership in 1985.

    The group has expanded beyond the United States in recent years. Europe and Asia currently account for 29% and 16% of sales, respectively. It intends to expand in China, India, Brazil and other emerging markets. The group implicitly mentioned the pressure on the global supply chain, saying that no country accounts for more than one-fifth of its purchases.

    According to the accounts, the company's revenue for the year ended November last year was US$5.6 billion, a year-on-year increase of 14%. Net profit increased from 281.4 million U.S. dollars in the previous year to 283.1 million U.S. dollars.

   Levi's listing plan puts pressure on the stocks of other apparel companies. As of the afternoon in New York, the stock prices of Gap, American Eagle Outfitters and Urban Outfitters have all fallen by at least 2%.