Zhejiang Wufangzhai Industry (SH:603237) 3 6 Ke·2025-10-09 02:37Core Viewpoint - Wufangzhai (603237.SH) is preparing for a secondary listing on the Hong Kong Stock Exchange to enhance its international strategy, brand image, and diversify its capital platform [1][2]. Group 1: Reasons for H-Share Listing - The move to list in Hong Kong is driven by the market's flexibility, international appeal, and favorable policies, which can help Wufangzhai reach global investors and expand its overseas business [2]. - Hong Kong's financing options are diverse, allowing for various fundraising methods, which is crucial as other markets face tighter financing conditions [2][7]. - The company's growth has been sluggish, prompting the need for new funding sources and international market expansion [2][5]. Group 2: Company Performance and Financials - Wufangzhai's financial performance has declined, with 2024 revenue at 2.251 billion yuan, marking a new low since its IPO, and net profit at 142 million yuan, unchanged from 2020 [5]. - The core product, zongzi, saw an 18.64% revenue drop to 1.579 billion yuan in 2024, with a significant decrease in sales volume [5][12]. - In the first half of 2025, while revenue slightly improved, net profit fell by 16.70%, indicating a struggle with profitability despite revenue growth [5][12]. Group 3: Product and Market Strategy - Wufangzhai has diversified its product offerings beyond zongzi to include mooncakes, tangyuan, and other food items, responding to consumer trends for healthier options [3][9]. - The company is focusing on developing fresh and organic products, with a new line of organic zongzi made from certified ingredients [9][11]. - Despite efforts to expand product categories, non-zongzi products accounted for only 20% of total revenue in the first half of 2025 [12]. Group 4: International Expansion Efforts - Wufangzhai's management has emphasized international expansion, with new markets in South Korea, UAE, and Thailand being explored [7]. - The company reported a 22.06% decline in overseas revenue, which constituted only 0.4% of total income, highlighting the need for stronger international market presence [7][12]. - The upcoming Hong Kong listing is expected to support its international strategy by providing necessary capital and enhancing brand value globally [7][14].