Company Dynamics - Hong Kong Stock Exchange is set to welcome the listing of Baima Tea Co., Ltd. on October 28, with the stock code 6980.HK [2] - During the subscription period, Baima Tea received overwhelming market interest, achieving an oversubscription rate of over 1920 times, setting a new record for IPO subscriptions in the Hong Kong tea industry [2] - The global offering commenced on October 20, with a plan to issue 9 million shares, including 900,000 shares for public offering in Hong Kong and 8.1 million shares for international offering, at a price range of HKD 45.0 to 50.0 per share [2] - By October 23, the public offering portion attracted subscription funds amounting to HKD 86.4 billion, significantly exceeding the original public offering target of approximately HKD 45 million [2] Business Overview - Established in 1997, Baima Tea's core business includes research and design of tea and related products, standard output, and brand retail [2] - The company has developed an industry-leading "full category, multi-brand" product matrix, covering six major tea types: Oolong, black, red, green, white, and yellow tea, along with non-tea products such as tea utensils, tea snacks, and tea beverages [2] - Baima Tea also provides supporting services such as tea beverage box services, franchise licensing, and investment property leasing [2] Investment Background - Prior to the IPO, Baima Tea attracted interest from leading financial investment institutions and industry capital, including IDG Capital and Tiantu Capital [3] - The company is expected to officially list on October 28, with Huatai Financial Holdings (Hong Kong) Limited, Agricultural Bank of China International, and Tianfeng International Capital Markets Limited serving as joint sponsors [3] - Baima Tea's journey to capital markets has faced challenges, including delisting from the New Third Board and two unsuccessful attempts at A-share IPOs [3]

Core Viewpoint - Eight Horse Tea Industry has finally initiated its IPO process after a decade-long journey, planning to issue 9 million H-shares and aiming for a listing on the Hong Kong Stock Exchange on October 28, 2025, with support from Huatai International, Agricultural Bank of China International, and Tianfeng International [1] Industry Challenges - The path to listing for Chinese tea companies has been fraught with difficulties, as the tea business is deeply rooted in tradition, making it hard to standardize and scale, which are essential for capital market acceptance [2][3] - The fundamental contradiction in the Chinese tea industry lies in the pursuit of standardization while dealing with non-standard products, leading to skepticism about growth potential and scalability [3][4] Company Overview - Eight Horse Tea has established a vast network with 3,716 stores, of which over 90% are franchise stores, indicating a reliance on a franchise model for rapid expansion [6][7] - The franchise model has contributed to impressive growth, with franchise revenue increasing from 69% in 2022 to 75% in the first three quarters of 2024 [7] Profitability Concerns - The gross profit margin for franchise channels is significantly lower at 46%, compared to 78.2% for direct sales, raising concerns about overall profitability as the franchise model may erode profit margins [9] - The reliance on franchisees for growth poses risks, as any market saturation or franchisee financial difficulties could jeopardize the company's performance [9][10] Market Dynamics - The tea industry is facing a downturn, with seven out of nine listed tea companies reporting revenue declines in the first half of the year, while Eight Horse's revenue slightly decreased from 1.11 billion to 1.06 billion yuan [13] - The average annual spending of direct store members has also dropped by 13.6% from 2,860.4 yuan to 2,469.6 yuan between 2020 and 2024, indicating weakening consumer purchasing power [13] Strategic Adjustments - Eight Horse is exploring diversification beyond tea products, aiming to expand into related categories such as tea utensils and snacks, although tea sales still dominate its revenue [15][21] - The company is enhancing its online presence, with online channels contributing 35.4% of total revenue, while also creating flagship stores to provide unique customer experiences [18] Brand Perception - The brand is deeply associated with traditional tea, which may hinder its efforts to attract younger consumers and diversify its offerings [21][22] - The challenge lies in balancing the brand's traditional identity with the need for modernization and expansion into new markets [24][25]

Core Viewpoint - The upcoming IPO of Baima Tea Industry on the Hong Kong Stock Exchange has garnered significant market interest, achieving an oversubscription rate of over 1920 times, setting a new record for tea companies in Hong Kong [1][2]. Group 1: Market Response - Baima Tea's IPO has attracted substantial capital since its launch, with subscription amounts reaching 27.45 billion HKD on the first day, and 277.65 billion HKD by October 22, reflecting strong investor confidence in the company's growth prospects [2][4]. - The final oversubscription rate of over 1920 times highlights Baima Tea's status as the "super subscription king" among new tea stocks in Hong Kong, indicating its benchmark significance in the capitalization process of the Chinese tea industry [2][4]. Group 2: Company Positioning - Baima Tea, originating from a 300-year-old tea-making family, is recognized as the leader in the high-end tea market in China, holding the top sales position in the high-end Chinese tea sector [3][4]. - According to a report by Frost & Sullivan, Baima Tea ranks first in the sales of Oolong and black tea in China as of 2024, with its Tieguanyin sales leading the nation for over a decade [6]. Group 3: Financial Performance - Baima Tea's revenue is projected to grow from 1.818 billion RMB in 2022 to 2.143 billion RMB in 2024, with a compound annual growth rate (CAGR) of 8.6%, while net profit is expected to rise from 166 million RMB to 224 million RMB during the same period, reflecting a CAGR of 16.2% [6][7]. - The company has established over 3,700 offline chain stores across all provinces and major cities in China, solidifying its position as the leading brand in the tea retail sector [7]. Group 4: Brand Influence and Future Outlook - Baima Tea's brand influence extends beyond national borders, having represented Chinese tea at significant international events, which contributes to its strong brand moat [9]. - The company has attracted notable investors, including IDG Capital and Tiantu Capital, indicating strong market recognition of its business model and growth potential [9].

Core Viewpoint - Baima Tea Industry (6980.HK), the leading high-end tea company in China, has achieved a record-breaking IPO with a subscription amount of HKD 864.53 billion, oversubscribed by over 1920 times, setting a new record in the Hong Kong tea industry [1] Company Overview - Established in 1997, Baima Tea Industry is the largest high-end tea enterprise in China, focusing on the research, design, standard output, and brand retail of tea and related products [1] - The company has developed a leading "full-category, multi-brand" product matrix, covering six major tea types: Oolong, black, red, green, white, and yellow tea, along with non-tea products such as tea utensils, tea food, and tea beverages [1] IPO Details - The IPO involves the issuance of 9 million H-shares, with 10% allocated for public offering in Hong Kong and the remainder for international placement [1] - The share price is set between HKD 45 and HKD 50, aiming to raise a maximum of HKD 450 million, with an entry fee of HKD 5,050.43 for one lot of 100 shares [1] - The expected listing date is October 28 [1] Investor Interest - Prior to the IPO, Baima Tea Industry has attracted interest from several prominent investors, including top financial investment institutions, industrial capital, and professional financial institutions [1] - Notable shareholders include IDG Capital (6.87%), Tiantu Capital (4.74%), Yancheng Capital (3.00%), New Hope (3.00%), Fujian Qipiwolf and affiliates (4.56%), and GF Securities (1.07%) [1]

Group 1 - The core viewpoint of the news is that Baima Tea Industry is successfully launching its IPO with significant oversubscription, indicating strong investor interest in the high-end tea market in China [1][2]. - Baima Tea plans to issue 9 million shares with a public offering accounting for 10%, and the share price is set between 45 to 50 HKD, aiming to raise up to 450 million HKD [1]. - The company is recognized as the leading supplier of high-end tea in China, with a comprehensive product range covering six major categories of tea and related products [1][2]. Group 2 - The high-end tea market in China is experiencing rapid growth, with the market size projected to increase from approximately 89 billion RMB in 2020 to about 103.1 billion RMB in 2024, reflecting a compound annual growth rate (CAGR) of around 3.7% [2]. - Baima Tea has established a strong market position, being the top seller of high-end Chinese tea, and aims to enhance its brand value and expand its store network to achieve its vision of becoming the world's leading tea company [2]. - The company plans to allocate approximately 35% of the IPO proceeds for expanding production facilities, 20% for enhancing brand value and product range, and 15% for expanding its offline store network [3].

Group 1 - The core viewpoint of the news is that Baima Tea Industry, a well-known tea supplier in China, has successfully completed its IPO subscription, achieving a significant oversubscription of 1896 times with a total margin of at least HKD 853 billion [1] - Baima Tea plans to issue 9 million shares with a public offering accounting for 10%, at a price range of HKD 45 to 50 per share, aiming to raise a maximum of HKD 450 million [1] - The company is ranked first in China in terms of high-end tea sales revenue and has maintained leading positions in various tea categories for over a decade [1][2] Group 2 - The high-end tea market in China is experiencing rapid growth, with the market size projected to increase from approximately RMB 890 billion in 2020 to about RMB 1,031 billion in 2024, reflecting a compound annual growth rate (CAGR) of approximately 3.7% [2] - Baima Tea aims to enhance its brand value and expand its product portfolio while continuing to innovate and digitize its operations to achieve its vision of becoming the world's leading tea company [2] Group 3 - According to the prospectus, approximately 35% of the funds raised from the global offering will be used for expanding and constructing new production bases, while 20% will enhance brand value and product offerings [3] - The company plans to allocate 15% of the funds for the expansion of its direct offline store network, focusing on flagship stores, and 10% for improving digital business operations [3]

Core Viewpoint - Baima Tea Industry announced a global offering of 9 million H shares, with an expected net fundraising of HKD 368 million, and plans to list on the Hong Kong Stock Exchange by October 28, 2025 [1] Group 1 - The company plans to offer 900,000 H shares in Hong Kong and 8.1 million H shares internationally [1] - The subscription period for the shares is set from October 20 to October 23 [1] - The expected net proceeds from the global offering are HKD 368 million [1]

Core Viewpoint - The implementation of new IPO share allocation rules in Hong Kong has led to 17 Mechanism B new stocks being listed without any breaking below their issue price, indicating that market sentiment and liquidity have become more significant than fundamentals in the current environment [1]. Group 1: IPO Information - Company Name: Baima Tea (06980.HK) [1] - Industry: Tea [1] - Offering Date: October 20 to October 23 [1] - Total Shares Issued: 9 million, with 10% for public offering and 90% for international placement [1] - Offering Price: HKD 45 to 50 [1] - Market Capitalization: HKD 38.25 billion to 42.5 billion [1] - Price-to-Earnings Ratio: 17 times [1] - Minimum Subscription Amount: HKD 5,050 [1] - Listing Date: October 28 [1] - Sponsors: Huatai, Agricultural Bank of China, Tianfeng [1] Group 2: Company Overview - Baima Tea was established in 1997 and operates as a high-end tea chain brand covering the entire industry chain from cultivation to sales [2]. - The product range includes various types of tea and related products, forming a comprehensive tea product matrix [2]. Group 3: Market Position and Performance - Baima Tea's market share in the high-end tea sector has increased from approximately 1.1% in 2020 to about 1.7% in 2024, ranking first in China's high-end tea market by sales revenue [2]. - As of June 30, 2025, Baima Tea has 3,585 offline stores, including 244 direct-operated and 3,341 franchised stores, with a significant online presence [3]. Group 4: Financial Performance - Revenue increased from RMB 1.82 billion in 2022 to RMB 2.14 billion in 2024, while net profit rose from RMB 166 million to RMB 224 million during the same period [4]. - In the first half of 2025, revenue declined by 4.2% year-on-year to RMB 1.06 billion, and net profit fell by 17.8% to RMB 120 million, attributed to adjustments in offline store numbers and increased administrative expenses [5]. - The revenue structure is primarily composed of franchise business, online sales, and direct store sales, with franchise sales contributing around 50% of total revenue [5]. Group 5: Industry Trends - The Chinese tea industry is large but fragmented, with a market size of RMB 325.8 billion in 2024, expected to grow to RMB 407.9 billion by 2029, at a CAGR of approximately 4.6% [6]. - The high-end tea market is projected to grow from RMB 103.1 billion in 2024 to RMB 135.3 billion by 2029, with a CAGR of about 5.6% [6]. - The trend is shifting towards brand tea purchases and rapid growth in online channels, with the online tea market expected to exceed RMB 35 billion in 2024 [6]. Group 6: Investment Considerations - Baima Tea's market capitalization is HKD 42.5 billion, with a valuation of 17 times earnings, which may be considered high in a traditional industry with limited growth [7]. - The IPO is expected to attract significant interest, with a predicted oversubscription of 3,000 times [8].

Core Viewpoint - Baima Tea Industry has made significant progress in its listing process, having commenced a global offering on October 20, 2025, aiming to list on the Hong Kong Stock Exchange after multiple previous attempts in the A-share market [2] Group 1: Listing Details - Baima Tea plans to globally offer approximately 9 million H-shares, with 900,000 shares available for public offering in Hong Kong and 8.1 million shares for international offering [2] - The subscription period for the shares is from October 20 to October 23, 2025, with an expected listing date of October 28, 2025 [2] - The proposed price range for the shares is between HKD 45.0 and HKD 50.0, with an estimated net fundraising of HKD 368 million if priced at the median of HKD 47.5 [2] Group 2: Use of Proceeds - Approximately 35% of the net proceeds will be allocated to expanding and constructing new production bases [3] - About 20% will be used to enhance brand value and expand the product portfolio [3] - Around 15% is designated for funding the expansion of the company's direct retail store network, focusing on flagship stores [3] - 10% will be invested in improving the digital operations of the business [3] - Another 10% is earmarked for acquisitions or investments in participants within the Chinese tea industry [3] - The remaining 10% will be used for working capital and other general corporate purposes [3] Group 3: Company Performance - Baima Tea's revenue for the years 2022 to 2025 (first half) is reported as follows: RMB 1.818 billion, RMB 2.122 billion, RMB 2.143 billion, and RMB 1.063 billion respectively [5] - The total profit and comprehensive income for the same periods are RMB 166 million, RMB 206 million, RMB 224 million, and RMB 120 million respectively [5] - Baima Tea is recognized as a leading tea supplier in China, ranking first in high-end tea sales revenue and in the number of tea chain specialty stores as of 2024 [3]

Core Viewpoint - Baima Tea Industry plans to globally offer 9 million shares, aiming to raise approximately HKD 428 million for expansion and new production facilities [1] Group 1: Share Offering Details - The offering includes 900,000 shares for Hong Kong and 8.1 million shares for international investors [1] - The subscription period is from October 20 to October 23, with a maximum offer price of HKD 50 per share [1] - The entry fee for investors is approximately HKD 5,050.43 for a minimum lot of 100 shares [1] Group 2: Fundraising Purpose and Financials - The expected net proceeds from the offering are HKD 368 million, which will be used for expanding the company's production base and constructing new facilities [1] - Baima Tea Industry is projected to be listed on the main board by October 28, 2025 [1] Group 3: Underwriters - The joint sponsors for the offering include Huatai Financial Holdings (Hong Kong) Limited, Agricultural Bank of China International, and Tianfeng International Capital Market [1]