Core Viewpoint - Chao Hong Ji, known as the "King of K Gold," is facing legal challenges from international brands such as Bulgari and Richemont, which may impact its IPO plans in Hong Kong [1][2]. Company Overview - Chao Hong Ji was founded by Liao Muzhi and his son Liao Chuangbin, focusing on K gold and jewelry products, and is the first chain jewelry brand listed in A-shares [2]. - The company emphasizes original design and has a unique product feature of cartoon IP collaborations, including partnerships with top global IPs like Kuromi and Minions [2]. Market Position - According to Frost & Sullivan, Chao Hong Ji is projected to rank first among jewelry companies in mainland China by sales revenue in 2024, with a market share of 1.4% [2]. - The company is also expected to be the fastest-growing jewelry brand in mainland China in 2024, based on the number of new franchise stores opened [2]. Legal Challenges - Chao Hong Ji is currently involved in multiple lawsuits regarding trademark and design infringement, with claims totaling 5 million RMB from Bulgari and Richemont [3][4]. - The company has faced a ruling from the Suzhou Intermediate Court, requiring it to compensate Richemont 1 million RMB for infringement related to bracelet products [4]. Financial Performance - Chao Hong Ji reported a revenue of 6.518 billion RMB in 2024, a year-on-year increase of 10.48%, but its net profit decreased by 41.91% to 194 million RMB [6]. - The company has accumulated goodwill impairment provisions of 658 million RMB related to its acquisition of the FION brand, which has not performed as expected [5][6]. Brand Performance - The FION brand has shown a declining trend in same-store sales, with a 21.8% decrease in 2024 and a 15.5% decrease in the first half of 2025 [7].

Core Viewpoint - Chao Hong Ji plans to go public in Hong Kong, aiming for an "A+H" listing to enhance its global strategy and brand image [1] Group 1: IPO and Stock Performance - Chao Hong Ji's stock price experienced significant fluctuations, with a cumulative increase of over 20% over three trading days [1] - On May 20, the stock reached a closing price of 11.28 yuan per share, resulting in a total market capitalization of 100.22 billion yuan [1] - The company announced its intention to issue H-shares on the Hong Kong Stock Exchange, with details yet to be finalized [1] Group 2: Business Operations and Market Expansion - Despite a significant store closure trend in 2024, Chao Hong Ji continues to expand its channel layout, adding 129 new jewelry stores, bringing the total to 1,505 [2] - The company has initiated its internationalization strategy by entering the Southeast Asian market, opening stores in Kuala Lumpur and Bangkok [2] - In 2025, the company plans to further focus on Southeast Asia to strengthen its international market presence [2] Group 3: Financial Performance - In 2024, Chao Hong Ji reported a revenue of 6.518 billion yuan, a year-on-year increase of 10.48%, but a net profit decline of 41.91% to 194 million yuan [2] - The decline in profit is attributed to goodwill impairment related to the acquisition of FION, with a provision of 177 million yuan for goodwill impairment in 2024 [2] - In the first quarter of the current year, the company achieved a revenue of 2.252 billion yuan, a year-on-year growth of 25.36%, and a net profit of 189 million yuan, up 44.38% [2] Group 4: R&D and Competitive Edge - Chao Hong Ji is focusing on its core business and accelerating its digital transformation, with R&D expenses increasing over the years [3] - R&D expenses for 2023, 2024, and the first quarter of 2025 were 62.69 million yuan, 68.09 million yuan, and 23.21 million yuan, reflecting year-on-year growth rates of 4.76%, 8.62%, and 46.36% respectively [3]