HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Capital Markets

Fujian Wanchen Biotechnology Group / Equity Capital Markets

Fujian Wanchen Biotechnology Group (300972 CH)

<ul>
<li>The core of WANCHEN’s business model is to build a virtuous cycle system based on economies of scale. However, the pain point is large scale but low profit margin.</li>
<li>WANCHEN would maintain high-speed growth throughout 2025, but the growth rate will gradually slow down. Our forecast is revenue YoY growth from 2025 to 2027 is 80%, 40%, 25%, respectively.</li>
<li>WANCHEN’s peer is BUSY MING, but they have different investment logic and growth story. Which company has a higher valuation largely depends on which narrative logic the capital market favors.  </li>
</ul>


The core of WANCHEN’s business model is to build a virtuous cycle system based on economies of scale. However, the pain point is large scale but low profit margin.
WANCHEN would maintain high-speed growth throughout 2025, but the growth rate will gradually slow down. Our forecast is revenue YoY growth from 2025 to 2027 is 80%, 40%, 25%, respectively.
WANCHEN’s peer is BUSY MING, but they have different investment logic and growth story. Which company has a higher valuation largely depends on which narrative logic the capital market favors.  


Pre-IPO Fujian Wanchen Biotechnology Group - The Business Model, Peer Comparison, and the Outlook

Liuliu Orchard Group / Equity Capital Markets

<ul>
<li>Liuliumei is shifting resources to the Prune-based/plum jelly categories, but gross margins declined. The shrinking of dried plum snacks hasn’t been effectively replaced by emerging categories, presenting a structural risk</li>
<li>The sudden dividend is widely interpreted by the market as a benefit cash-out arrangement for existing shareholders and key stakeholders before the listing, causing serious damage to Liuliumei's governance image</li>
<li>A neutral scenario is 16-20x P/E, reflecting the market’s recognition of Liuliumei’s leading position in the segment, and certain premium has been given for the potential of new growth point.</li>
</ul>


Liuliumei is shifting resources to the Prune-based/plum jelly categories, but gross margins declined. The shrinking of dried plum snacks hasn’t been effectively replaced by emerging categories, presenting a structural risk
The sudden dividend is widely interpreted by the market as a benefit cash-out arrangement for existing shareholders and key stakeholders before the listing, causing serious damage to Liuliumei's governance image
A neutral scenario is 16-20x P/E, reflecting the market’s recognition of Liuliumei’s leading position in the segment, and certain premium has been given for the potential of new growth point.


Pre-IPO Liuliumei Co., Ltd. (PHIP Updates) - Some Points Worth the Attention

<ul>
<li>Jintan has taken the lead in niche market with "IP+ snacks" model, achieving strong short-term growth.However, it has been constrained by external IP reliance, rising customer concentration, cash flow pressure.</li>
<li>With seasonal adjustments in 25H2, the revenue growth rate could be 10%YoY in 2025 full year. With the diversification of IP/channels expansion, revenue growth could be 15%YoY/12%YoY in 2026/2027.</li>
<li>Jintan's characteristic is high growth but high external IP dependency risk, so a reasonable valuation should be lower than Pop Mart but higher than other traditional snack enterprises.</li>
</ul>


Jintan has taken the lead in niche market with "IP+ snacks" model, achieving strong short-term growth.However, it has been constrained by external IP reliance, rising customer concentration, cash flow pressure.
With seasonal adjustments in 25H2, the revenue growth rate could be 10%YoY in 2025 full year. With the diversification of IP/channels expansion, revenue growth could be 15%YoY/12%YoY in 2026/2027.
Jintan's characteristic is high growth but high external IP dependency risk, so a reasonable valuation should be lower than Pop Mart but higher than other traditional snack enterprises.


Pre-IPO Jintan - About the Business Model, the Risks and the Peer Comparison

<ul>
<li>The IPO pricing of BUSY MING is attractive. P/E of 20-30x is an acceptable valuation range in the short term. The IPO pricing leaves certain upside potential for stock price.</li>
<li>The profit situation of the franchisees is not optimistic. The rate of store closures is increasing. This makes us start to worry about the sustainability of BUSY MING's franchise model.</li>
<li>The current high growth may not be sustainable.BUSY MING clearly hopes to successfully IPO during the current peak period of performance, but investors may face performance decline in the future.</li>
</ul>


The IPO pricing of BUSY MING is attractive. P/E of 20-30x is an acceptable valuation range in the short term. The IPO pricing leaves certain upside potential for stock price.
The profit situation of the franchisees is not optimistic. The rate of store closures is increasing. This makes us start to worry about the sustainability of BUSY MING's franchise model.
The current high growth may not be sustainable.BUSY MING clearly hopes to successfully IPO during the current peak period of performance, but investors may face performance decline in the future.


Busy Ming Group (1768 HK) IPO - Thoughts on Valuation and the Outlook

<ul>
<li>The revenue growth being higher than the GMV growth in 25Q1-Q3 indicates that BUSY MING’s control over channels and supply chains as well as its bargaining power are strengthening.</li>
<li>BUSY MING’s business model has a low tolerance for errors. Upstream cost increase, downstream price wars, or decline in operational efficiency would break through the already thin profit barrier.</li>
<li>BUSY MING’s valuation should be lower than Pop Mart, but may be slightly higher or on par with MINISO, and in the same range as Wanchen. 20-30x P/E is acceptable.</li>
</ul>


The revenue growth being higher than the GMV growth in 25Q1-Q3 indicates that BUSY MING’s control over channels and supply chains as well as its bargaining power are strengthening.
BUSY MING’s business model has a low tolerance for errors. Upstream cost increase, downstream price wars, or decline in operational efficiency would break through the already thin profit barrier.
BUSY MING’s valuation should be lower than Pop Mart, but may be slightly higher or on par with MINISO, and in the same range as Wanchen. 20-30x P/E is acceptable.


Pre-IPO Busy Ming Group (PHIP Updates) - Some Points Worth the Attention

China

Fujian Wanchen Biotechnology Group Co.,Ltd. operates edible fungus cultivation businesses. The Company provides edible fungi factory cultivation, research and development, packaging, sales, deep processing, and other services. Fujian Wanchen Biotech nology also conducts leisure agriculture tourism businesses.

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Fujian Wanchen Biotechnology Group (300972 CH)

Pre-IPO Fujian Wanchen Biotechnology Group - The Business Model, Peer Comparison, and the Outlook

WANCHEN's business model relies on economies of scale but faces low profit margin and decreasing growth rate. Valuation compared to BUSY MING...

Xinyao (Criss) Wang

Pre-IPO Liuliumei Co., Ltd. (PHIP Updates) - Some Points Worth the Attention

Liuliumei shift focus to new categories but face declining margin. Dividend seen as cash-out before IPO damages governance image.16-20x PE is...

Xinyao (Criss) Wang

Pre-IPO Jintan - About the Business Model, the Risks and the Peer Comparison

Jintan's "IP+ snack" model leads niche market but face risk.Revenue expected to be up 10% in 2025, with potential for 15%/12% in 2026/27.Valuation...

Xinyao (Criss) Wang

Busy Ming Group (1768 HK) IPO - Thoughts on Valuation and the Outlook

BUSY MING's attractive IPO pricing leaves upside potential, but concerns arise over franchisee profits and sustainability of growth model....

Xinyao (Criss) Wang

Pre-IPO Busy Ming Group (PHIP Updates) - Some Points Worth the Attention

BUSY MING's IPO pricing is HK$229.6-236.6/share, with market value of HK$49.16-50.7bn. If based on our 2025, 2026, 2027 profit forecast, P/E would...

Xinyao (Criss) Wang

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Pre-IPO Fujian Wanchen Biotechnology Group - The Business Model, Peer Comparison, and the Outlook

​WANCHEN's business model relies on economies of scale but faces low profit margin and decreasing growth rate. Valuation compared to BUSY MING...

Xinyao (Criss) Wang

Pre-IPO Liuliumei Co., Ltd. (PHIP Updates) - Some Points Worth the Attention

​Liuliumei shift focus to new categories but face declining margin. Dividend seen as cash-out before IPO damages governance image.16-20x PE is...

Xinyao (Criss) Wang

Pre-IPO Jintan - About the Business Model, the Risks and the Peer Comparison

​Jintan's "IP+ snack" model leads niche market but face risk.Revenue expected to be up 10% in 2025, with potential for 15%/12% in 2026/27.Valuation...

Xinyao (Criss) Wang

Busy Ming Group (1768 HK) IPO - Thoughts on Valuation and the Outlook

​BUSY MING's attractive IPO pricing leaves upside potential, but concerns arise over franchisee profits and sustainability of growth model....

Xinyao (Criss) Wang

Pre-IPO Busy Ming Group (PHIP Updates) - Some Points Worth the Attention

BUSY MING's IPO pricing is HK$229.6-236.6/share, with market value of HK$49.16-50.7bn. If based on our 2025, 2026, 2027 profit forecast, P/E would...

Xinyao (Criss) Wang

WANCHEN's business model relies on economies of scale but faces low profit margin and decreasing growth rate. Valuation compared to BUSY MING...

Liuliumei shift focus to new categories but face declining margin. Dividend seen as cash-out before IPO damages governance image.16-20x PE is...

Jintan's "IP+ snack" model leads niche market but face risk.Revenue expected to be up 10% in 2025, with potential for 15%/12% in 2026/27.Valuation...

BUSY MING's attractive IPO pricing leaves upside potential, but concerns arise over franchisee profits and sustainability of growth model....