Core Viewpoint - Metro Supply Chain's application for a Hong Kong IPO has become invalid, marking the third failed attempt, leading to increased uncertainty regarding its listing prospects [1][2][4]. Company Overview - Metro Supply Chain, originally a German brand, opened its first store in Shanghai in 1996, focusing on B2B operations with a membership and cash-and-carry model [2]. - In October 2019, Metro China was acquired by Wumart Group, which integrated it into its operations [2]. Financial Performance - From 2021 to 2023, Metro Supply Chain reported revenues of RMB 27.82 billion, RMB 27.10 billion, and RMB 24.86 billion, with net profits of RMB 0.33 billion, a loss of RMB 0.47 billion, and a profit of RMB 0.25 billion respectively [6]. - In the first seven months of 2024, the company achieved revenue of RMB 14.82 billion, a year-on-year decline of 0.96%, with a net loss of RMB 41 million, a reduction of 54.19% compared to the previous period [6]. Business Segments - The main business segments of Metro Supply Chain include retail distribution solutions, food service and distribution solutions, welfare gift solutions, and wholesale [5]. - The retail distribution solutions segment is heavily reliant on Wumart Group, which accounted for over 60% of the company's revenue in recent years [9][11]. Client Dependency - In 2022, 2023, and the first seven months of 2024, revenue from Wumart Group was RMB 16.89 billion, RMB 15.40 billion, and RMB 9.11 billion, representing 62.3%, 62.0%, and 61.4% of total revenue respectively [9]. - The company's dependency on Wumart has raised concerns about its operational sustainability, especially as Wumart's store count decreased by approximately 15% [11][12]. Profitability Challenges - The gross margin for the retail distribution solutions segment was only 3.8% in the first seven months of 2024, compared to 18.7% for food service and distribution solutions [12]. - The overall gross margin for Metro Supply Chain was reported at 9.7% [12]. Future Outlook - Metro Supply Chain aims to reduce its reliance on Wumart by expanding its client base, having recently added two independent third-party retail clients in Hunan and Hubei [11]. - Despite efforts to diversify, revenue from other clients remains minimal, contributing only RMB 2.3 million in the first seven months of 2024 [11].