Consumer Staples Author：Xinyu Chen Editor：Yiru Qian Mar 31, 2023 01:19 PM (GMT+8)

Nayuki is a leading tea brand in China's sprawling on-demand tea drinks industry. However, the competition is here and here to stay.

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China's leading tea brand Nayuki (2150:HK) reported a total annual revenue of CNY 4.291 billion and an adjusted net loss of CNY 461.3 million, according to its annual results announcement released on March 30.

As of December 31, 2022, Nayuki has 1,068 directly operated stores in 89 cities across the country, making it the largest directly operated tea brand. Throughout the year, the company recorded a store-level operating profit of CNY 469.9 million for Nayuki teahouses, with a store-level operating profit margin of 11.8% for each store. Meanwhile, the number of registered memberships grew to 56.6 million in 2022, up 30.7% from 43.3 million in 2021, and the monthly repurchase rate increased to 26.3%.

The company stated in the announcement that in 2023, Nayuki expects to maintain an active and steady store opening by increasing store density in the existing high-tier cities and continues evaluating the store opening plan.

With the control measures for Covid-19 being lifted, the operating situation and financial indicators improved. For the 2023 outlook, Nayuki shows confidence in recovering offline consumption, income and profitability.

In the domestic market, Nayuki faces intense and direct competition from HeyTea and other tea brands such as MXBC (Chinese: 蜜雪冰城) and Modern China Tea Shop (Chinese: 茶颜悦色).

Nayuki closed at HKD 8.45 apiece as of press time, with a market cap of HKD 14.44 billion.