Global Offering Details - The global offering consists of 17,059,900 H shares, with 1,706,000 shares available for Hong Kong public offering and 15,353,900 shares for international offering[5]. - The offering price is set at HKD 202.50 per H share, with additional fees including a 1.0% brokerage commission and various transaction fees[6]. - The shares have a par value of RMB 1.00 each, and the stock code is 2097[5]. - The overall coordinators and joint global coordinators include BofA Securities, Goldman Sachs, and UBS, among others[5]. - The company has adopted a fully electronic application process for the Hong Kong public offering, with no physical copies of the prospectus provided[10]. - Investors must apply for a minimum of 100 shares, with specific payment amounts based on the chosen quantity[11]. - The offering shares are not registered under U.S. securities laws and cannot be offered or sold in the U.S. or to U.S. persons[8]. - The company reserves the right to adjust the number of shares and/or the offering price before the submission deadline[7]. - The prospectus has been submitted for registration with the Hong Kong Companies Registry under the relevant laws[6]. - Investors are advised to consider all information in the prospectus, including risk factors, before making investment decisions[7]. - The Hong Kong public offering is scheduled to start on February 21, 2025, at 9:00 AM[15]. - The deadline for electronic applications via the designated website is February 26, 2025, at 11:30 AM[15]. - The expected announcement of subscription levels and allocation criteria will be made by February 28, 2025, at 11:00 PM[16]. - H shares are expected to begin trading on the Hong Kong Stock Exchange on March 3, 2025, at 9:00 AM[18]. - Refunds for unsuccessful applications will be issued on March 3, 2025[19]. - The maximum number of shares that can be applied for in the Hong Kong offering is 853,000[12]. - The total payment amounts for various share quantities range from HKD 20,454.22 for 100 shares to HKD 174,474,507.27 for 853,000 shares[12]. - The company will not issue temporary ownership documents for the shares; H shares will only become valid ownership certificates on the listing date[24]. - The company will publish announcements on its website and the Hong Kong Stock Exchange regarding the allocation results[18]. - Any applications for shares outside the specified quantities may be rejected[12]. Company Operations and Market Position - The company operates over 45,000 stores across China and 11 other countries as of September 30, 2024[32]. - The beverage output reached approximately 7.4 billion cups in 2023 and 7.1 billion cups in the nine months ending September 30, 2024[32]. - The company holds a market share of approximately 11.3% in China and 2.2% globally based on retail sales in 2023[32]. - The company has reduced the use of PE plastic by over 12,700 tons through green upgrades of beverage packaging in 2023[38]. - The company has established a complete end-to-end supply chain system, covering procurement, production, logistics, R&D, and quality control[35]. - The company launched its first overseas store in Hanoi, Vietnam, and has expanded its product offerings to include fresh ice cream and coffee[36]. - The company is recognized as the largest fresh beverage enterprise in China and the second largest globally based on beverage output in 2023[32]. - Approximately 35% of the company's franchisees are women, and 69% of store employees are female[38]. - The company has signed a long-term cooperation agreement with Jiangnan University for industry-academia-research collaboration[38]. - The company aims to maintain a strong commitment to social responsibility and sustainable development strategies[38]. Financial Performance - In 2021, 2022, 2023, and the first nine months of 2024, the company's retail sales reached approximately RMB 22.8 billion, RMB 30.7 billion, RMB 47.8 billion, and RMB 44.9 billion respectively[39]. - Revenue for 2022, 2023, and the first nine months of 2024 was RMB 13.6 billion, RMB 20.3 billion, and RMB 18.7 billion, representing year-on-year growth of 31.2%, 49.6%, and 21.2% respectively[39]. - Net profit for 2022, 2023, and the first nine months of 2024 was RMB 2 billion, RMB 3.2 billion, and RMB 3.5 billion, with year-on-year growth of 5.3%, 58.3%, and 42.3% respectively[39]. - Operating cash flow for 2021, 2022, 2023, and the first nine months of 2024 was RMB 1.7 billion, RMB 2.4 billion, RMB 3.8 billion, and RMB 5.1 billion respectively[39]. - The company's main brand, "Mixue Ice City," contributed over 95% to total revenue and gross profit during the reporting period[40]. - The gross margin for "Mixue Ice City" was 31.4%, 28.9%, 30.3%, and 32.9% for 2021, 2022, 2023, and the first nine months of 2024 respectively[40]. - Revenue from overseas markets, particularly from Indonesia and Vietnam, accounted for approximately 70% or more of the company's overseas income during the reporting period[45]. - The revenue from franchise fees and related services was 1.9% in 2021, 2.0% in 2022, 2.0% in 2023, and 2.4% in the first nine months of 2024[52]. - Franchise stores generated revenue of RMB 19,575,307 thousand with a gross profit of RMB 5,892,349 thousand and a gross margin of 30.1% in 2023[54]. - Self-operated stores recorded a revenue of RMB 38,515 thousand with a gross profit of RMB 5,301 thousand and a gross margin of 13.8% in the first nine months of 2024, indicating a decline due to a reduction in the number of self-operated stores[56]. Supply Chain and Logistics - The company has the largest end-to-end supply chain system in the Chinese ready-to-drink beverage industry, covering procurement, production, logistics, R&D, and quality control[58]. - The total area of the company's five production bases is approximately 790,000 square meters, with an annual comprehensive production capacity of about 1.65 million tons[61]. - The company's logistics network includes 27 warehouses with a total area of approximately 350,000 square meters, covering over 300 cities and 1,700 counties in mainland China[64]. - The company has established a global procurement network covering 38 countries, allowing it to source raw materials at prices below the industry average[58]. - The company plans to close or transfer several self-operated stores to franchisees as part of its strategy to expand its franchise network[56]. Market Trends and Future Outlook - The global ready-to-drink beverage market is projected to grow at a compound annual growth rate (CAGR) of 7.2% from 2023 to 2028, reaching a market size of $1,103.9 billion by 2028[73]. - The ready-to-drink beverage market in China is expected to reach approximately RMB 1,163.4 billion by 2028, with a CAGR of 17.6% from 2023 to 2028[76]. - The Southeast Asian ready-to-drink beverage market is forecasted to grow from $20.1 billion in 2023 to $49.5 billion in 2028, representing a CAGR of 19.8%[77]. - The average annual per capita consumption of ready-to-drink beverages in China is expected to increase to 51 cups by 2028, more than doubling from current levels[73]. - The company aims to expand its market presence and enhance product offerings in 2024, focusing on new technology development and strategic partnerships[71]. Challenges and Risks - The company faces significant competition in the ready-to-drink beverage market, which could adversely affect its market share and profitability if it fails to compete effectively[113]. - The company’s operational performance may be negatively impacted by any decline in consumer demand for its products[111]. - The company faces risks related to consumer demand fluctuations, which are influenced by changing consumer preferences and disposable income levels[173]. - The company’s operational performance may be adversely affected if it fails to effectively manage its extensive store network and supply chain capabilities[176]. - The company cannot guarantee that its strategic efforts will fully offset the adverse impacts of market slowdown and intensified competition in the short term[181]. - The company faces significant risks related to brand value, which could be adversely affected by negative publicity regarding its products or operations[183]. - Quality control and food safety are critical, with potential issues leading to significant reputational damage and financial impact[190]. Financial Projections and Investments - Estimated consolidated profit attributable to the parent company for the year ending December 31, 2024, is projected to be RMB 4.4 billion (approximately HKD 4.8 billion)[121]. - The estimated total listing expenses for the global offering is approximately HKD 163.7 million, accounting for 4.7% of the total proceeds[121]. - The net proceeds from the global offering, assuming no exercise of the over-allotment option, is estimated to be approximately HKD 3,291 million[127]. - Approximately 66% or HKD 2,172 million of the net proceeds will be used to enhance the breadth and depth of the end-to-end supply chain[130]. - Approximately 12% or HKD 395 million will be allocated for brand and IP development and promotion[130]. - The company is investing 200 million RMB in R&D for new technologies aimed at enhancing customer experience and operational efficiency[5]. - The company is exploring potential acquisitions to enhance its supply chain capabilities, with a budget of 500 million RMB allocated for this purpose[7]. Store Network and Expansion - The total number of stores has increased from 20,001 in 2021 to 37,565 in 2023, with a target of 45,302 stores by 2024[83]. - The franchise network expanded from 19,954 stores on December 31, 2021, to 37,516 stores by December 31, 2023, and is projected to reach 45,282 stores by September 30, 2024[185]. - The company plans to increase its store count to 4,209 by the end of 2024, up from 3,630 in 2023, representing a growth of 15.9%[71]. - The company operates in first-tier cities including Beijing, Shanghai, Guangzhou, and Shenzhen, and has plans for expansion into new first-tier cities[163]. Digital and Marketing Strategies - A new marketing strategy has been implemented, aiming to increase brand awareness by 30% over the next year[8]. - The company plans to enhance its digital presence, targeting a 50% increase in online sales channels by the end of the next fiscal year[10].
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