Core Viewpoint - The stock price of Baima Tea has experienced a dramatic decline after an initial surge, raising questions about the sustainability of the high-end Chinese tea business model and highlighting industry pain points [2][4]. Group 1: Stock Performance and Market Reaction - Baima Tea's stock price fell to HKD 30.14 per share, a decline of over 70% from its peak, resulting in a market value loss of nearly HKD 70 billion [2]. - The stock's initial surge was driven by limited liquidity and speculative trading, with only 5,298,700 H-shares available for trading post-IPO, of which approximately 4.4 million were locked up due to shareholder commitments [3]. - On its first trading day, Baima Tea's stock opened at HKD 86.5, a 73% increase from the IPO price of HKD 50, and briefly reached a market capitalization close to HKD 80 billion [3]. Group 2: Financial Performance and Challenges - Baima Tea's revenue growth has slowed, with a reported increase from RMB 1.818 billion in 2022 to RMB 2.143 billion in 2024, but the growth rate has decreased, with only a 1% increase in 2024 [9]. - In the first half of 2025, the company reported a revenue of RMB 1.063 billion, a decrease of 4.2% year-on-year, and a net profit of RMB 120 million, down 17.8% [9]. - High operating costs are eroding profits, with sales and marketing expenses reaching RMB 332 million in the first half of 2025, accounting for 31.2% of revenue [10]. Group 3: Business Model and Strategic Outlook - The franchise model has contributed significantly to Baima Tea's revenue, with franchise sales accounting for approximately 50% of total revenue from 2022 to 2025 [12]. - The company has 3,716 offline stores, with 93.7% being franchise stores, indicating a heavy reliance on franchisees for revenue generation [11]. - Baima Tea plans to use IPO proceeds to expand brand flagship stores in high-tier cities, deepen franchise coverage in lower-tier markets, upgrade supply chains, and promote international branding, particularly in Southeast Asia [15].
八马茶业上市之路坎坷：高端茶资本化陷估值困境