Customers are waiting for orders at Guming (Good ME) in Yichang, Hubei Province.
Liu Junfeng/VCG via Getty Images
Wang Yun'an, 38, founder of China's Milk Tea Company, has become a billionaire after a chain listed in Hong Kong on Wednesday.
According to Forbes, Wang is the chairman and CEO of Guming, and his revenue is $1.2 billion, mainly based on his shares in the Zhangjiang-Beadquartered Company. The company's shares rose 4.6% in morning trading
According to the stock exchange application, chewing gum raised HK$1.8 billion (US$233 million) through the high-end sale of 182.4 million shares through the range of previous sales.
So far, its stock market performance has surpassed competitors such as Nayuki Holdings and Chapanda. Chapanda, a Chinese milk tea chain that sells similar products such as freshly brewed tea mixed with fruits, collapsed nearly 30% on the first trading day in April 2024. Chapanda has been below its IPO price since worrying about Cutries – competition in the industry.
Kenny Ng, an international securities strategist at Everbright Securities, said underwriters may buy gum to support an IPO. According to the February 4 research report, given the fierce competition and “small product differentiation”, Clarence Chu, a Singaporean analyst at Aequitas Research, wrote that further share prices could be subject to the risk of suffering, given the fierce competition and “less product differentiation”. limit.
Chewing gum did not respond to an email request for comment.
In addition to mixing tea with fruit or chewy cassava balls, the company adopts the same expansion strategy as its competitors. Since its start in 2010, it has expanded its network to nearly 10,000 stores in China by using the franchise model to sell milk tea ingredients to its franchisees and charging fees for training.
Wang opened his first gum store in his hometown of Daxi in 2010 after graduating from Zhige Science Fiction University with a bachelor's degree in engineering. The company’s price ranges between 10 yuan per cup ($1.40) and 20 yuan per cup, and is still in Qianjiangbao, where the base accounts for one-fifth of its network.
In the first nine months of 2024, the latest financial results were available, with Guming's revenue increasing by 15.6% year-on-year to RMB 6.4 billion. Its prospectus shows that its profit was RMB 1.1 billion, an increase of 11.8% over the same period last year.
NG said he advised investors to wait and see. “I think its valuation is still at a relatively high level,” he said. “Investors can check if a company can maintain its IPO price later.”
