Core Viewpoint - The rise of national trends and the demand for personalization and light luxury are driving the continuous expansion of the Chinese jewelry market, with the market size expected to grow from 610 billion yuan in 2020 to 728 billion yuan in 2024, and projected to reach 937 billion yuan by 2029, reflecting a compound annual growth rate of 5.2% from 2024 to 2029 [1] Company Overview -潮宏基 focuses on jewelry and fashion handbag products, with approximately 90% of its revenue coming from the jewelry business between 2022 and the first half of 2025. The revenue share of fashion jewelry decreased from 56.2% to 48.6%, while classic gold jewelry's share increased from 32.6% to 44.6% during the same period [2][4] - The company operates two core brands: "CHJ 潮宏基," established in 1997, and "FION 菲安妮," acquired in 2014.潮宏基 may face significant expenses and liabilities due to potential intellectual property infringement claims [4][5] Market Dynamics - The jewelry market in China is characterized by high supplier concentration, with the top five suppliers accounting for over 70% of total procurement. The largest supplier alone represents over 50% of total procurement [7] -潮宏基 employs a combination of self-production and outsourcing for its manufacturing processes, with a significant portion of its products sold through self-operated stores, franchisees, and e-commerce platforms [7][8] Financial Performance -潮宏基's revenue for the years 2022, 2023, 2024, and the first half of 2025 was approximately 4.364 billion yuan, 5.836 billion yuan, 6.452 billion yuan, and 4.062 billion yuan, respectively. The gross profit margins for these years were 29.3%, 25.3%, 22.6%, and 23.1% [9] - The company has experienced a decline in gross profit margin over the past two years due to increased competition and a shift in sales channels, with a notable decrease in the sales of higher-margin products [9][14] Competitive Landscape -潮宏基 ranks ninth among jewelry companies in China by revenue, holding a market share of 0.8%. In the fashion jewelry segment, it ranks first with a market share of 1.4% [14] - The fashion jewelry market in China has contracted, with the market size decreasing from 284.8 billion yuan in 2020 to 203.8 billion yuan in 2024, reflecting a compound annual growth rate of -8% [14] Future Prospects -潮宏基 plans to use the funds raised from its IPO to establish 20 self-operated CHJ潮宏基 stores overseas, open a new office in Hong Kong, and launch three flagship stores in mainland China [18] - The company faces challenges in balancing scale expansion with profitability quality amid intense competition and increasing accounts receivable risks [18]

Core Viewpoint - The jewelry brand潮宏基 is planning to go public on the Hong Kong Stock Exchange, indicating its growth and expansion strategy in the jewelry market [1] Company Background -潮宏基 was founded in 1997 in the Guangdong Chaozhou region, with its founder 廖创宾 starting in the gold jewelry wholesale and retail business at a young age [2] - The company initially operated as a "gold broker," leveraging local craftsmanship and market knowledge to connect clients with gold processing workshops [2][3] - In response to increasing competition from Hong Kong and Taiwan-funded gold processing enterprises, the company shifted its focus to jewelry design and production, eventually establishing itself as a fashion jewelry brand [3] Financial Performance - As of September 15, 2024,潮宏基's total market capitalization was approximately 135 billion [4] - For the fiscal year 2024, the company reported a revenue of 6.52 billion, a year-on-year increase of 10.5%, while net profit decreased by 41.9% to 194 million [4] - In the first half of 2025,潮宏基 achieved a revenue of 4.102 billion, reflecting a year-on-year growth of 19.54%, and net profit increased by 44.34% to 331 million [4] Market Trends - The jewelry market is experiencing rapid growth driven by innovation in craftsmanship and design, with younger consumers becoming the primary market force [4] -潮宏基's strategic focus on mid-to-high-end fashion consumer products, particularly its core brands "CHJ潮宏基" and "FION菲安妮," aligns with this trend [4] - The perception of gold jewelry is shifting among younger consumers, who now view it as a fashionable item and a "liquid asset," contrasting with the previous focus on diamonds and luxury goods [5]