HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Capital Markets

<ul>
<li>MIXUE invited experts to conduct calculations based on population data. The result is a maximum of 45,000 stores can be opened. So, MIXUE has reached the growth ceiling in China.</li>
<li>The pain point is since MIXUE’s growth depends significantly on its ability to expand store network, once the growth of franchised stores slows down, a performance decline would be inevitable.</li>
<li>Due to larger scale effect/stronger supply chains/higher net profit margin, MIXUE’s valuation should be higher than peers. Higher valuation depends on whether MIXUE is able to make breakthrough in internationalization.</li>
</ul>


MIXUE invited experts to conduct calculations based on population data. The result is a maximum of 45,000 stores can be opened. So, MIXUE has reached the growth ceiling in China.
The pain point is since MIXUE’s growth depends significantly on its ability to expand store network, once the growth of franchised stores slows down, a performance decline would be inevitable.
Due to larger scale effect/stronger supply chains/higher net profit margin, MIXUE’s valuation should be higher than peers. Higher valuation depends on whether MIXUE is able to make breakthrough in internationalization.


Pre-IPO MIXUE Group Update - The Snow King Is Facing Headwinds

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/guming-holdings-limited" target="_blank" data-smartkarma-citation="entities:40622:1" rel="noopener">Guming Holdings (GUM HK)</a> (Good me), a freshly-made tea store brand, is pre-marketing an HKEx IPO to raise US$300 million, according to press reports.</li>
<li>In <a href="https://www.smartkarma.com/insights/guming-holdings-good-me-ipo-the-bull-case" target="_blank" data-smartkarma-citation="insights:173217" rel="noopener">Guming Holdings (Good Me) IPO: The Bull Case</a>, we highlighted the key elements of the bull case. In this note, we outline the bear case.</li>
<li>The bear case rests on under-pressure store KPIs, unsustainable historical growth rates, declining contract liabilities, margin pressure due to competition and a sizeable pre-IPO dividend.</li>
</ul>



Guming Holdings (GUM HK) (Good me), a freshly-made tea store brand, is pre-marketing an HKEx IPO to raise US$300 million, according to press reports.
In Guming Holdings (Good Me) IPO: The Bull Case, we highlighted the key elements of the bull case. In this note, we outline the bear case.
The bear case rests on under-pressure store KPIs, unsustainable historical growth rates, declining contract liabilities, margin pressure due to competition and a sizeable pre-IPO dividend.


Guming Holdings (Good Me) IPO: The Bear Case

<ul>
<li>
<a href="https://www.smartkarma.com/entities/guming-holdings-limited" target="_blank" data-smartkarma-citation="entities:40622:1" rel="noopener">Guming Holdings (GUM HK)</a> (Good me), a freshly-made tea store brand, is pre-marketing an HKEx IPO to raise US$300 million, according to press reports. </li>
<li>Guming is China’s largest mid-priced freshly-made tea store brand and the second largest freshly-made brand across all price ranges, regarding GMV in 2023.</li>
<li>The bull case rests on a rising market share, strong franchisee profitability, top-tier revenue growth, high margins, cash generation and a strong balance sheet. </li>
</ul>



Guming Holdings (GUM HK) (Good me), a freshly-made tea store brand, is pre-marketing an HKEx IPO to raise US$300 million, according to press reports. 
Guming is China’s largest mid-priced freshly-made tea store brand and the second largest freshly-made brand across all price ranges, regarding GMV in 2023.
The bull case rests on a rising market share, strong franchisee profitability, top-tier revenue growth, high margins, cash generation and a strong balance sheet. 


Guming Holdings (Good Me) IPO: The Bull Case

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Sichuan Baicha Baidao Industrial / Equity Capital Markets

Sichuan Baicha Baidao Industrial (2555 HK)

<ul>
<li>
<a href="https://www.smartkarma.com/entities/sichuan-baicha-baidao-industrial-co-ltd" target="_blank" data-smartkarma-citation="entities:40029:1" rel="noopener">Sichuan Baicha Baidao Industrial (2555 HK)</a> (SBBI) raised around US$330m in its HK IPO.</li>
<li>SBBI sells new-style tea drinks through its ChaPanda stores. According to F&amp;S, SBBI ranked third in China’s new-style tea shop market with a market share of 6.8% in FY23.</li>
<li>We have looked at the company’s performance and valuations in our past note. In this note, we talk about the trading dynamics.</li>
</ul>



Sichuan Baicha Baidao Industrial (2555 HK) (SBBI) raised around US$330m in its HK IPO.
SBBI sells new-style tea drinks through its ChaPanda stores. According to F&amp;S, SBBI ranked third in China’s new-style tea shop market with a market share of 6.8% in FY23.
We have looked at the company’s performance and valuations in our past note. In this note, we talk about the trading dynamics.


Sichuan Baicha Baidao IPO Trading - Tepid Demand, While Peers Have Corrected

<ul>
<li>
<a href="https://www.smartkarma.com/entities/sichuan-baicha-baidao-industrial" target="_blank" data-smartkarma-citation="entities:40029:1" rel="noopener">Sichuan Baicha Baidao Industrial (SCBCBDID CH)</a>, a leading freshly made tea drinks company, has launched an HKEx IPO to raise US$330 million. The shares will be listed on 23 April.</li>
<li>We previously discussed the IPO in <a href="https://www.smartkarma.com/insights/baicha-baidao-ipo-the-bull-case" target="_blank" data-smartkarma-citation="insights:136692" rel="noopener">Baicha Baidao IPO: The Bull Case</a> and <a href="https://www.smartkarma.com/insights/baicha-baidao-ipo-the-bear-case" target="_blank" data-smartkarma-citation="insights:136734" rel="noopener">Baicha Baidao IPO: The Bear Case</a>. </li>
<li>There are no cornerstone investors. Our valuation analysis suggests that Baicha is fairly valued at the HK$17.50 IPO price. Therefore, we would pass on the IPO.</li>
</ul>



Sichuan Baicha Baidao Industrial (SCBCBDID CH), a leading freshly made tea drinks company, has launched an HKEx IPO to raise US$330 million. The shares will be listed on 23 April.
We previously discussed the IPO in Baicha Baidao IPO: The Bull Case and Baicha Baidao IPO: The Bear Case. 
There are no cornerstone investors. Our valuation analysis suggests that Baicha is fairly valued at the HK$17.50 IPO price. Therefore, we would pass on the IPO.


Baicha Baidao (2555 HK) IPO: Valuation Insights

China

Auntea Jenny (Shanghai) Industrial Co., Ltd. operates a chain of tea shops offering a diverse range of freshly made beverages and snacks, including fruit tea, milk tea, yogurt shakes, coffee, and ice cream. The company primarily serves the domestic market in the People's Republic of China through franchised and self-operated stores. It was founded in 2013 and is headquartered in Shanghai, China.

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Auntea Jenny (2589 HK)

Pre-IPO MIXUE Group Update - The Snow King Is Facing Headwinds

MIXUE has hit growth ceiling in China with 45,000 store limit, faces performance decline if franchise growth slows. Valuation should be higher...

Xinyao (Criss) Wang

Guming Holdings (Good Me) IPO: The Bear Case

The bear case rests on under-pressure store KPIs, unsustainable historical growth rates, declining contract liabilities, margin pressure due to...

Arun George

Guming Holdings (Good Me) IPO: The Bull Case

The bull case rests on a rising market share, strong franchisee profitability, top-tier revenue growth, high margins, cash generation and a strong...

Arun George

Sichuan Baicha Baidao IPO Trading - Tepid Demand, While Peers Have Corrected

Sichuan Baicha Baidao Industrial (2555 HK) (SBBI) raised around US$330m in its HK IPO. In this note, we talk about the trading dynamics.

Sumeet Singh

Baicha Baidao (2555 HK) IPO: Valuation Insights

Our valuation analysis suggests that Baicha is fairly valued at the HK$17.50 IPO price. Therefore, we would pass on the IPO.

Arun George

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Pre-IPO MIXUE Group Update - The Snow King Is Facing Headwinds

​MIXUE has hit growth ceiling in China with 45,000 store limit, faces performance decline if franchise growth slows. Valuation should be higher...

Xinyao (Criss) Wang

Guming Holdings (Good Me) IPO: The Bear Case

The bear case rests on under-pressure store KPIs, unsustainable historical growth rates, declining contract liabilities, margin pressure due to...

Arun George

Guming Holdings (Good Me) IPO: The Bull Case

The bull case rests on a rising market share, strong franchisee profitability, top-tier revenue growth, high margins, cash generation and a strong...

Arun George

Sichuan Baicha Baidao IPO Trading - Tepid Demand, While Peers Have Corrected

Sichuan Baicha Baidao Industrial (2555 HK) (SBBI) raised around US$330m in its HK IPO. In this note, we talk about the trading dynamics.

Sumeet Singh

Baicha Baidao (2555 HK) IPO: Valuation Insights

Our valuation analysis suggests that Baicha is fairly valued at the HK$17.50 IPO price. Therefore, we would pass on the IPO.

Arun George

MIXUE has hit growth ceiling in China with 45,000 store limit, faces performance decline if franchise growth slows. Valuation should be higher...