Core Viewpoint - The recent food safety controversy surrounding the company, particularly the allegations regarding the use of coloring agents in its products, raises questions about its upcoming IPO and the scrutiny of its fundamentals in the capital market [1][3][18] Group 1: Food Safety Concerns - The company faces scrutiny over its "Farmhouse Steamed Eggs" and raw eggs, which were reported to contain coloring agents, coinciding with its third attempt at an IPO [1][3] - Previous issues, such as the "180-day free-range chicken" controversy, led the company to release a comprehensive internal traceability report, which, while detailed, raises questions about the actual execution of food safety standards [3][4][5] - The effectiveness of the company's food safety management relies on continuous execution and improvement, as outlined in the PDCA cycle, rather than just the establishment of standards [4][5] Group 2: Financial Performance and Expansion - The company's revenue increased from 4.528 billion RMB in 2022 to 5.651 billion RMB in 2023, with a projected 4.678 billion RMB for the first three quarters of 2024 [6][7] - Net profit rose from 252 million RMB in 2022 to 375 million RMB in 2023, with 367 million RMB reported for the first three quarters of 2024 [6][7] - The average consumer price at company-owned stores decreased from 29.7 RMB in 2022 to 27.6 RMB in the first three quarters of 2024, indicating pressure on profit margins [9] Group 3: Market Position and Competition - The company claims to be the leader in the Chinese fast-food industry, but its market share is only 0.8%, highlighting a lack of significant brand barriers in a fragmented market [13][14][16] - The competitive landscape is intensifying, with regional brands and established players like KFC and McDonald's increasing their presence and adapting their menus to local tastes [16][17] - The company has faced challenges in maintaining investor confidence, as evidenced by the buyback of shares from previous investors, indicating uncertainty about its long-term growth prospects [16][17]