Rate Of Return
Buffett Apprentice[Hong Kong IPO] CHABAIDAO + Tianjin Construction Development subscription strategy
1、CHABAIDAO
In 2008, the first CHABAIDAO store was born in Chengdu. Since its establishment, CHABAIDAO has focused on exploring the combination of natural ingredients and Chinese tea drinks, continuously developing diversified tea drink products, and is committed to improving consumer experience. Through a franchise model that benefits both franchisees and the company, it has now developed into a nationally renowned freshly made tea drink enterprise. Under the franchise model, the company collaborates with qualified franchisees by participating in business planning and site selection, providing in-depth training, supplying raw materials and equipment, and offering services. Franchisees mainly focus on the daily operation and maintenance of their stores, on-site staff management, and customer service. During the track record period, our revenue came from selling goods and equipment to franchisees, charging franchisees royalties and franchise fees, and other sources.
The company started its IPO on April 15,with an offer price of HKD 17.5 per share, 200 shares per lot, a minimum subscription of HKD 3,535.3, a market capitalization of HKD 25.859 billion, and an issuance of 148 million shares. It belongs to the non-alcoholic beverage industry, with a greenshoe option but no cornerstone investors.
The sponsor is China International Capital Corporation (CICC). The overall performance of the sponsor is average, with a 44% first-day rise rate for projects sponsored by CICC in the past two years. However, CICC's ability to stabilize the market is relatively strong.
The company's revenue from 2021 to 2023 was RMB 3.644 billion, RMB 4.232 billion, and RMB 5.704 billion, respectively, with a year-on-year increase of 34.8% in 2023. Net profits from 2021 to 2023 were RMB 779 million, RMB 965 million, and RMB 1.151 billion, respectively, with a year-on-year increase of 19.28% in 2023. The performance is quite good.
Some say that NAYUKI, another milk tea stock, is now priced at only HKD 2.61, so why can CHABAIDAO's offer price be set at HKD 17.5? From the stock price perspective, CHABAIDAO is indeed more expensive, but its performance is much better than NAYUKI's. CHABAIDAO's P/E ratio is 22.47 times, while NAYUKI's is as high as 290 times.
The current subscription multiple is 0.36 times, indicating poor subscription interest. However, today is the first day of the IPO, and the final interest should be higher.
Subscription Strategy:
CHABAIDAO is the second milk tea stock to be listed on the Hong Kong stock market, with NAYUKI being the first. Back then, investing in NAYUKI cost me a whole year's worth of milk tea money. CHABAIDAO ranks third in the freshly made tea drink industry. The sponsor is CICC, with a 44% first-day rise rate for projects sponsored in the past two years, though CICC's market stabilization ability is relatively strong. This issuance has a greenshoe option but no cornerstone investors. The company's net profit in 2023 increased by 19.28% year-on-year, which is quite good. NAYUKI's P/E ratio is 290 times, while CHABAIDAO's is only 22.47 times, making the latter's issuance relatively inexpensive. Recently, Hong Kong IPO subscriptions have also shown signs of recovery. I plan to participate this time, hoping to recoup the milk tea money I lost in NAYUKI.
2、Tianjin Construction & Development Group
The company is a construction group based in Tianjin, providing comprehensive engineering construction services. According to Frost & Sullivan's report, there were 2,547 construction enterprises in Tianjin in 2022. Based on the engineering construction revenue in Tianjin in 2022, the group accounted for 0.1% of the entire engineering construction market. In terms of revenue generated from municipal public engineering in 2022, we ranked fourth among private municipal public engineering companies in Tianjin, accounting for about 0.2% of the market share. During the track record period, we were mainly engaged in engineering construction business and committed to providing high-quality engineering construction services to customers.
The company started its IPO on April 15, with an offer price range of HKD 2.5 to HKD 2.9 per share, 2,000 shares per lot, a minimum subscription of HKD 3,535.3, a market capitalization of HKD 539 million to HKD 626 million, and an issuance of 53.95 million shares. It belongs to the heavy infrastructure industry, with a greenshoe option but no cornerstone investors.
The sponsor is Everbright Financing. The overall performance of the sponsor is poor, having sponsored only one project in the past two years, which fell on its first day of listing.
The company's revenue from 2021 to 2023 was RMB 275 million, RMB 288 million, and RMB 319 million, respectively, with a year-on-year increase of 10.93% in 2023. Net profits from 2021 to 2023 were RMB 41.414 million, RMB 35.09 million, and RMB 41.045 million, respectively, with a year-on-year increase of 16.97% in 2023.
The current subscription multiple is 1.87 times, indicating decent subscription interest. There are still three days left in the IPO period, and the final interest should be higher.
Subscription Strategy:
The company is a construction group based in Tianjin, providing comprehensive engineering construction services, ranking fourth among private municipal public engineering companies in Tianjin. The sponsor's performance is also poor, having sponsored only one project in the past two years, which fell on its first day of listing. There is a greenshoe option but no cornerstone investors, and the performance is somewhat unstable, with net profit increasing in 2022. The current subscription multiple is 1.87 times, indicating decent subscription interest. This is another small-cap stock with little highlight, depending on whether it will be hyped. However, in the recent IPO market, small-cap stocks have performed relatively better. Interested friends can try their luck, while cautious ones may skip it. I plan to wait a couple of days to see the subscription interest before deciding!
Follow me: @小散老俞$CHABAIDAO(02555.HK) $TJCD(02515.HK) $NAYUKI(02150.HK)
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