Stock price soared by 80%! CHABAIDAO enters the Hong Kong market with a hot business, prices are 70% higher than the mainland

On the 16th, the beverage concept stocks in Hong Kong strengthened, with CHABAIDAO's stock price soaring nearly 80% at one point.

On the 11th, CHABAIDAO's first store in Hong Kong officially opened, with prices in Hong Kong 70% higher than on the mainland, but this did not dampen the enthusiasm of Hong Kong people for its products. The opening day saw exceptionally strong sales, with consumers waiting for about 2 hours.

Not only did CHABAIDAO perform well, another well-known tea beverage brand, Naixue Tea, also saw its stock price rise, with a significant increase of nearly 26% during the day.

With the entry of these two major tea beverage giants, the Hong Kong tea beverage market is facing a new competitive landscape.

The first day of business was booming, with an average wait time of about 2 hours and prices about 70% higher than on the mainland

On October 11th, the tea beverage brand CHABAIDAO officially entered the Hong Kong market, with its first store opening on Sai Yeung Choi Street South in Mong Kok, Kowloon.

The store features a "grab and go" fast pick-up model, and despite incomplete equipment and the temporary inability to use Octopus cards and mini-programs, consumers were enthusiastic, with an average wait time of about 2 hours.

It is reported that CHABAIDAO's pricing in Hong Kong is much higher than on the mainland, but this has not stopped Hong Kong people from embracing its tea beverages.

For example, a medium-sized Yang Zhi Ganluo is sold for 17 RMB on the mainland and 32 HKD in Hong Kong, which, based on the exchange rate on the opening day, is about 29 RMB, an increase of about 70%.

In terms of products, CHABAIDAO has launched 21 drinks in Hong Kong, including fruit tea and milk tea, but the product variety is not as rich as on the mainland.

CHABAIDAO's accelerated overseas expansion, can it replicate success in the Hong Kong market?

It is worth noting that Hong Kong is not CHABAIDAO's first stop overseas. Unlike many tea beverage brands that choose Southeast Asia for their first overseas store, CHABAIDAO's first overseas store is in South Korea. In January of this year, CHABAIDAO opened its first overseas store in Seoul, South Korea, and by the end of June, it had also entered Thailand and Australia simultaneously.

CHABAIDAO's semi-annual report shows that as of June 30, 2024, it had opened 4 stores in South Korea, 2 in Thailand, and 1 in Australia. South Korea has become the main battlefield for CHABAIDAO's overseas business, with a total of 7 stores currently in operation.

CHABAIDAO's co-founder and vice president, Gu Jilin, has introduced that the proportion of local people buying at CHABAIDAO's South Korean stores has exceeded 80%, and the operating profit margin of the four stores that have opened is higher than that of domestic stores, with a significantly shorter investment return period than domestic stores.

However, the Hong Kong market is highly competitive, with high rental and labor costs, posing challenges for mainland tea beverage brands. According to incomplete statistics from Yilan Business, since 2023, more than 15 Hong Kong stores of 6 mainland tea and coffee brands have closed. Tea beverage brands accounted for over 50% of the closed brands

After the initial freshness fades, ensuring long-term profitability and consumer loyalty will be the key test for CHABAIDAO's development in Hong Kong