Asahi Marusan Management reported this morning that Chinese e-commerce operator Pinduoduo Inc which is backed by Tencent Holdings is planning to raise up to $1.6 billion during its US IPO to bolster its fight against rival Alibaba.

Pinduoduo Inc located in Shanghai, is offering 85.5 million Depositary Shares in the US with a price between $16 and $19 per share.

Leading Chinese social media company Tencent and existing shareholder Sequoia Capital have equally expressed interest in buying $250 million worth of stock Asahi Marusan Management added.

Pinduoduo Inc, widely known as PDD is considered to be one of China’s most powerful and fastest growing startups. Famous for popularizing a system where people see deals on a variety of products, and can recruit friends in order to get a discount of up to 20% off market prices has led this Chinese Facebook-Groupon mashup to quickly become a major rival to Alibaba.

Founded 3 years ago by Colin Huang, a former Google engineer, this startup is believed to have a top end valuation target of $30 billion, already putting it on par with on-demand services giant MeituanDianping. Based on that, Pinduoduo Inc may very well be valued at around $20 billion after the IPO launch with Huang remaining in control most of the voting rights.

“Ongoing marketing efforts across the country mean Pinduoduo Inc have yet to turn a profit, making them one of the most ambitious tech companies to go public this year that are still making a loss,” said Timothy Grant, Senior Vice President at Asahi Marusan Management.

Pinduoduo Inc has handled 262 billion yuan ($39 billion) in transactions for the past year which equates to more than 300 million active buyers. This managed to gain them great growth in their April valuation. The company had a tripling of revenue for 2017 at around $278 million, but the losses are higher too, 55% higher and they are now at $79.5 million!