Core Viewpoint - Laoxiangji is attempting to become the "first Chinese fast food stock" by applying for a listing on the Hong Kong Stock Exchange after multiple failed attempts to go public in A-shares [3][8]. Group 1: Company Overview - Laoxiangji is the largest Chinese fast food brand, with a market share of 0.9% in the Chinese fast food industry, ranking first in the Chinese fast food sector by transaction volume in 2024 [4]. - The company has experienced revenue growth from 4.528 billion yuan in 2022 to 6.288 billion yuan in 2024, with net profits increasing from 252 million yuan to 409 million yuan during the same period [4][5]. - As of April 2025, Laoxiangji operates 1,564 stores across 58 cities, with 911 being company-owned and 653 being franchise stores [5]. Group 2: Business Model and Expansion - Laoxiangji has accelerated its store openings through a franchise model, adding an average of 118 new stores annually [4][5]. - The number of franchise stores has significantly increased, with 565 franchise stores by 2024, while the number of company-owned stores has decreased from 1,007 to 914 during the same period [5][6]. - Franchise stores account for a growing share of revenue, with franchise store income rising from 8.2% to 19.3% in early 2025, while company-owned store income decreased from 89.6% to 77.7% [5]. Group 3: Financial Performance - In the first four months of 2025, Laoxiangji reported revenue of 2.12 billion yuan, a year-on-year increase of 9.9%, and a net profit of 174 million yuan, up 7.3% [4]. - The gross profit margin for the first four months of 2025 was 24.2%, compared to 22.8% in 2024 [4][10]. - The average daily sales per company-owned store were 16,000 yuan, while franchise stores averaged 12,400 yuan, indicating a 20% lower performance for franchise stores [7]. Group 4: Ownership and IPO Plans - Following failed attempts to list on A-shares, Laoxiangji's early financial investors exited before the IPO, leading to a family-controlled structure with the founder's family holding 92.02% of voting rights [8][10]. - The company plans to use the funds raised from the IPO to enhance its supply chain, expand its store network, improve IT capabilities, and strengthen brand marketing [10].