Haidilao is seeking a broader scope of development through the spin-off of its overseas subsidiary
On July 13, Haidilao (6862:HK), China’s largest hotpot restaurant chain, is currently considering a spinoff of Super Hi International Holding Ltd (Super Hi), its overseas subsidiary of Haidilao for an initial public offering in Hong Kong by way of introduction.
The Board of Directors of Haidilao believes that the spinoff is in the interests of the company and its shareholders as a whole and will enable the business of Super Hi and the remaining businesses of the whole group to be better developed in their respective geographical areas.
However, as of now, Super Hi has not yet filed for an IPO.
Under the influence of covid-19, most restaurant companies are facing losses, and Haidilao is no exception.
According to its annual report released on March 23, 2021, the company achieved operating revenue of CNY41.11 billion in 2021, up 43.7% YoY, with an annual loss of CNY4.16 billion, while a net profit of CNY309 million was recorded in 2020.
In 2012, Haidilao opened its first overseas restaurant in Singapore, and its overseas restaurant network has expanded from 24 restaurants in 5 countries as of January 1, 2019 to 97 restaurants in 11 countries as of March 31, 2022.
The announcement also showed that revenue from overseas operations increased from USD 230 million in 2019 to USD 310 million in 2021, representing a compound annual growth rate of 15.8%. It displayed a sound performance of Haidilao's overseas business.
The firm’s competitors include Xiabu Xiabu (0520:HK), Want Hotpot and Banu.
As of press time, Haidilao closed at HKD 16.7 apiece, with a market cap of HKD 93.086 billion.