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On May 13, Haidilao disclosed with the U.S. Securities and Exchange Commission (SEC) that Haidilao's overseas business Tehai International Holdings Co., Ltd. (hereinafter referred to as "Tehai International") will issue 2,692,700 American Depositary Shares (ADS), which is expected to be traded on the NASDAQ stock market under the symbol "HDL". Upon completion of the Offering, the entities controlled by Daniel Zhang will collectively own 45.66% of the issued shares of the Company, assuming that the underwriters do not exercise the option to purchase additional ADSs.
As of December 31, 2023, Tehai International operates a total of 115 restaurants in the international market, of which 70 are located in Southeast Asia, 17 in East Asia, and 18 in North America.
It is reported that this is the second listing of Tehai International. On December 30, 2022, Tehai International was listed on the Hong Kong Stock Exchange, less than one and a half years after the time interval of this application for listing in the United States. If Tehai International successfully lands on NASDAQ, Haidilao founder Daniel Zhang and Shuping will usher in a fourth IPO in addition to Haidilao, Yihai International and Tehai International (IPO in Hong Kong).
Wang Hongdong, president of the Dining Treasure Research Institute, said that Tehai International's promotion of dual listing is on the one hand to expand its overseas business territory, and on the other hand, it wants to grasp the current wave of Chinese food going overseas.
Tehai International said in the prospectus that about 70% of the net proceeds from the dual listing will be used to enhance the brand and expand the global restaurant network; About 10% will be used to invest in supply chain management capabilities, such as building more central kitchens; About 10% will be spent on R&D to enhance the use of digitalization and other technologies in restaurant management; and about 10% will be used for working capital and other general corporate purposes.
Looking back at the development of Haidilao enterprises:
——Haidilao: The layout of the hot pot business
Founded in 1994 and listed on the main board of the Hong Kong Stock Exchange in 2018, the Haidilao brand has grown into a leading enterprise in the domestic hot pot industry. Over the years, Haidilao has continued to establish stores and expand the market. By the end of 2020, Haidilao had 1,298 stores around the world, covering markets in Asia, North America, Oceania, Europe and other markets.
——Haidilao: Store layout
The expansion of the number of stores contributes to the growth of revenue scale. In the past two years, the number of Haidilao stores has been expanding rapidly, and in 2020, the total number of Haidilao net global stores has reached 1,298, and the number of net stores opened has reached 530, both of which have grown rapidly compared with 2019.
——Haidilao: operating performance of hot pot business
From the perspective of Haidilao's operation, benefiting from the rapid expansion of stores, from 2017 to 2020, Haidilao's hot pot business revenue grew steadily, but in terms of profitability, due to the impact of exchange rate fluctuations, rising costs and other reasons, the company's gross profit margin continued to decline from 2017 to 2020.
——Haidilao: hot pot business development planning
According to the company's communiqué, Haidilao's future business strategy is still the road of expansion, and it seeks to improve services and technology in the expansion. The specific strategies are: increasing restaurant density and expanding the area of restaurant coverage, continuing to improve the dining experience, continuing to invest in innovation and new technologies, and seeking to acquire high-quality resources.
According to the analysis of the Prospective Industry Research Institute, in the future, new formats such as hot pot takeaway, self-heating hot pot, and hot pot ingredient supermarket will gradually emerge to meet more hot pot consumption scenarios for consumers; In addition, with the continuous improvement of consumers' awareness of food safety, food safety will become the primary concern of hot pot enterprises; Finally, at present, there are many enterprises in the hot pot industry in mainland China, and the problem of homogenization is serious, and the hot pot enterprises will develop towards the trend of personalization and diversification in the future. With the improvement of the income level of mainland residents and the increase in demand for food consumption, the development prospect of the mainland hot pot industry is broad. According to Sullivan data, it is estimated that by 2025, the market size of the mainland industry will reach 850.1 billion yuan.
Prospective Economist APP Information Group
For more research and analysis of this industry, please refer to the "Market Prospect and Investment Strategic Planning Analysis Report of China's Hot Pot Chain Industry" by the Prospective Industry Research Institute.
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