There is a kind of investment called "buy and be trapped".
On April 23, Chinese milk tea brand Cha Baidao was listed in Hong Kong, which is the largest IPO in Hong Kong this year.
However, on the day of listing, Chabaidao fell as much as 38% intraday, then plummeted nearly 27% to close at HK$12.8, and fell 9.38% the next day to close at HK$11.60.
For a company that has raised at least 2.5 billion yuan, the plunge was the worst first-day performance for a Chinese listed company since 2015.
Why did it plummet, is it the performance of Tea Baidao?
In fact, no, the prospectus states that from 2021 to 2023, the revenue of Tea Baidao will increase from 3.64 billion yuan to 5.70 billion yuan, with a compound annual growth rate of 25.1%.
The adjusted net profit also increased from 900 million yuan to 1.26 billion yuan, with a compound annual growth rate of 18.2%.
You must know that there are many milk tea companies that are now listed in the Hong Kong stock market, such as Mixue Bingcheng, Chayan Yuese, Bawang Chaji, Gu Ming, and Shanghai Auntie.....
In terms of scale and revenue, Chabaidao is far inferior to Mixue Bingcheng, but it was listed before Mixue Bingcheng, to a large extent, because the prospectus was beautiful.
But behind this beauty, there is a great deal of business risk.
Some analysts believe that the current competition in the new tea market is fierce, and although Tea Baidao has a certain reputation, its market share and profitability still need to be improved.
The second is that the pricing of Chamodo is relatively high.
But these analyses are only appearances.
The deeper factor is that the "time, place, and people" of tea Baidao are lost.
Let's look at the "time of day" first, the so-called new tea concept was born with the trend of consumption upgrading.
In 2019, the founder of Beaver, Diao Ye, shouted the slogan "Every consumer product is worth redoing", aiming to raise the flag for the listing and financing of new consumer brands.
As a result, the imagination of "creating a Chinese Starbucks" has been written on the PPT of many brand financing.
Indeed, at that time, new tea drinks were a popular track for capital, and Nai Xue's tea was the first to be listed on the Hong Kong stock market.
Even the later so-and-so ramen and so-and-so fried skewers were all noisy and wanted to go in the direction of IPO.
At that time, the story of the capital market was basically a "single-store model" - through the popularity of a single store, the introduction of supply chain standardization, full-link digitalization and kitchen centralization mode, indicating that the brand has great imagination.
Then, with the help of capital leverage, the profit cake after scale is realized.
Three-word summary: learn from Luckin.
In 2021, the total financing of the new tea beverage industry will exceed 14 billion yuan, which is the peak of the 10-year cycle, and the bubble has been flooded!
And Tea Baidao, that is, at that time, was favored by capital.
In 2008, 25-year-old Wang Xiaokun and 27-year-old Liu Weihong founded Tea Baidao in Chengdu, which started as a bubble tea shop in front of a middle school.
Although they started from a humble start, the husband and wife have a strong brand awareness and capital structure.
In 2010, the trademark of "Tea Baidao" was officially registered, and in the following 10 years, Wang Xiaokun frequently contacted the investment market while bringing the stores of Tea Baidao to the whole country.
From 2019 to 2021, the number of Chabaidao stores soared from 500 to 5,000.
At the beginning of 2023, led by Orchid Asia, many well-known institutions such as CICC Capital and Tomato Capital have entered the financing bureau, with a single financing amount of up to 970 million, and in August of the same year, Chabaidao began to impact the listing of Hong Kong stocks.
Tea Baidao on the tuyere seized the opportunity, but also lost the tuyere.
After 2023, the new tea drink market will usher in a "cyclical correction".
Whether it is the consumption environment or the investment microclimate, everyone knows that there is no incentive for the bubble to blow.
Secondly, the tea market has also become a mess, and Nai Xue's tea, which landed on the Hong Kong stock market earlier, has been discounted and discounted, and the total market value of the listed company has fallen from a maximum of more than 30 billion Hong Kong dollars to less than 4 billion Hong Kong dollars.
Nearly 90% of the market capitalization is gone.
As for the companies that are not listed, they are also facing an increasingly saturated market, and the freshness of young people going to high-end milk tea shops to check in has passed.
The incremental space is getting smaller and smaller, and the brand is also fighting a price war.
Not to mention the sinking market of Mixue Bingcheng, even Hey Tea and Nai Xue's tea, which are positioned as high-end, have launched single products below 10 yuan.
The only way to continue to live is to burn money.
But the question is, whose money is burned?
For companies that have not yet been listed, investors now dare not throw money around.
At the end of 2022, ByteDance's dissolution of the war investment department is considered by the outside world to herald a great retreat from corporate investment.
According to the "2023-2024 Chinese New Tea Beverage Industry Development Report" released by Meal Treasure Book, at the end of March 2023-2024, there will be a total of 19 financings for new tea beverage enterprises, while there will be only two in the first three months of 2024, and the amount is only tens of millions.
Image source: Dining Book
In terms of geographical advantages, for Chabaidao, listing on the Hong Kong stock market, even if it is a last resort, is another big gamble.
At the beginning of this year, Wu Xiangjun went to Hong Kong for research, and the first thing he did after coming back was to throw away all his investments in Hong Kong stocks.
To paraphrase Tsai Chongxin's reason for withdrawing the rookie Hong Kong stock IPO, it is:
"At the moment, the market is sluggish, there is a lack of liquidity, and it makes no sense to push it. ”
To put it bluntly, the liquidity of the Hong Kong stock market is already very poor, and the stock prices of many mainland companies listed in recent years have been discounted by 5 or even 0.5 percent......
And in its current state, Hong Kong is no longer attractive for investment. ("Supermarkets in the mainland have become a paradise for Hong Kong people", click on the title to read)
It's not that Chabaidao is unaware of this situation, but the difficulty of catering companies to list on the mainland is much higher than that in Hong Kong.
If you want to go public and cash out quickly, you can only choose Hong Kong.
In this case, Cha Baidao must also swallow such a bitter fruit.
So, what about people and people?
I'm sorry, but people are getting smarter.
Looking closely at the prospectus of Tea Baidao, Tea Baidao does not make money from selling milk tea, but from franchisees.
According to the prospectus, the proportion of tea Baidao franchise stores is more than 99%, and there are only 6 directly-operated stores.
According to the prospectus, from 2021 to 2023, the revenue of Chabaidao will be 3.644 billion yuan, 4.232 billion yuan and 5.704 billion yuan respectively.
In the three years of the reporting period, there were 5,070, 6,352 and 7,795 tea stores respectively, accounting for more than 99% of the total number of tea stores!
The franchisee gave Tea Baidao a huge franchise fee, but did he make money himself?
According to iiMedia data, only 18.8% of tea shops have been in operation for more than a year, and the vast majority of franchisees have left the market in a bleak manner.
Therefore, in the so-called 100 billion tea market, the real "cheese" is not consumers, but franchisees.
The more people hit the wall, the more people will be sober.
Because of the decrease in new franchisees, Chabaidao has opened a discount mode and launched a policy of reduction and exemption of 40,000-270,000 yuan for new franchised merchants.
But this is already a signal of retreat for the capital market.
The bubble of the new tea drink is going to burst after all.
What is the technical content of a cup of milk tea?
In fact, there are very few, and the imitation threshold for taste, product, model, and pricing is too low.
What really counts as the core competitiveness is the organizational strength of the enterprise and the layout ability of the supply chain.
Therefore, after the listing, Chabaidao has also invested heavily in building its own supply chain and actively expanding overseas markets.
However, the involution and competition of new tea brands are still ongoing, and the change of tide may overturn everyone.
Looking at it now, after Tea Baidao, there are still many new tea brands lining up for IPO in Hong Kong.
For them, whether they can cross the dragon gate or not, they have to think about their own survival.
Just like Zhong Xuegao, the bursting of the bubble may be a few months.