Core Viewpoint - Guangdong Chao Hong Ji Industrial Co., Ltd. (潮宏基) has submitted an application for an IPO on the Hong Kong Stock Exchange, aiming for a dual listing in both A-shares and H-shares to enhance its global strategy and brand image [1][37]. Financial Performance - Chao Hong Ji's revenue for the years 2022, 2023, 2024, and the first half of 2025 were approximately 4.36 billion, 5.84 billion, 6.45 billion, and 4.06 billion RMB respectively, showing year-on-year growth rates of 33.73%, 10.56%, 19.59%, and a significant increase in the first half of 2025 compared to previous years [2][3][4]. - The net profit figures for the same periods were 205 million, 330 million, 169 million, and 333 million RMB, with year-on-year growth rates of 60.98%, -48.79%, and 44.07% [2][3][4]. Market Position - Chao Hong Ji ranks first in the mainland China fashion jewelry market with a market share of 1.4% as of 2024 [2]. - The company has a diversified brand portfolio, including CHJ潮宏基, CHJ·ZHEN臻, and others targeting different market segments [2]. Sales Channels - As of mid-2025, Chao Hong Ji operated 1,542 jewelry stores, including 201 self-operated and 1,337 franchised stores, along with four overseas stores [7][8]. - The revenue contribution from self-operated stores has decreased from 37.4% in 2022 to 27.3% in the first half of 2025, while the contribution from franchised networks has increased from 32.5% to 54.6% [10][11]. Profitability and Cost Structure - The overall gross margin of Chao Hong Ji has declined from 29.3% in 2022 to 22.6% in 2024, with a slight recovery to 23.1% in the first half of 2025 [5][6]. - The gross margin for self-operated stores was significantly higher than that of franchised networks, indicating a shift in profitability dynamics [8][9]. Strategic Initiatives - The company plans to open 20 CHJ jewelry stores overseas by the end of 2028, focusing on markets in Southeast Asia [8][37]. - Chao Hong Ji aims to leverage traditional cultural elements in its product designs to appeal to younger consumers, aligning with the rising trend of "Guochao" (national tide) [30][31]. Competitive Landscape - The jewelry market is highly competitive, with significant pressure from fluctuating gold prices and increasing operational costs [5][16]. - Chao Hong Ji's reliance on gold as a primary raw material poses risks, as it accounted for 94.4% to 98.3% of total material procurement during the reporting period [16]. Future Outlook - The company is positioned to capitalize on the growing demand for gold jewelry, particularly among younger consumers who value design and craftsmanship [30][31]. - Chao Hong Ji's IPO is seen as a strategic move to enhance its international presence and capitalize on the global market for fashion jewelry [38].