Chinese Tea Brand Bama Tea to Apply for IPO Again

Consumer Discretionary Author: Jiawei Wu Editor: Yiran Xing Sep 27, 2022 11:58 AM (GMT+8)

Hovering outside the capital market for many years, Bama Tea (Chinese: 八马茶业) again applies for being listed.

Tea

Bama Tea disclosed a prospectus on September 22, intending to be listed on the main board of the Shenzhen Stock Exchange.

According to the prospectus, Bama Tea is mainly engaged in the research and development of tea and related products design, standard output and brand retail business. After years of development, its products shifted to a full range of teas and implemented a franchise model to achieve cross-regional operations.

In terms of financial data, from 2019 to 2021, Bama Tea's revenue was CNY 1.023 billion (USD 0.148 billion), CNY 1.266 billion and CNY 1.744 billion respectively, and net profit attributable to owners of the parent company was CNY 91.816 million, CNY 116 million and CNY 163 million respectively.

In terms of performance, from 2019 to the first quarter of 2022, the operating revenue of Bama Tea is CNY 1.023 billion, CNY 1.266 billion, CNY 1.744 billion and CNY 451 million  respectively, and the net profit attributable to the owners is CNY 91.8816 million, CNY 116 million, CNY 163 million and CNY 451.469 million respectively.

In terms of R&D investment, from 2019 to the first quarter of 2022, the company's expenditure on this item is CNY 5.722 million, CNY 3.2801 million, CNY 6.64112 million and CNY 1.14885, accounting for 0.56%, 0.26%, 0.38% and 0.33% of operating revenue, respectively. As of the end of March this year, the total number of R&D personnel of the company was 11, accounting for 0.49% of the total number of employees of the company; there were 6 core technical personnel.

As of the end of the reporting period, the number of the company's offline stores exceeded 2,700.

Bama Tea submitted a prospectus to the Shenzhen Stock Exchange GEM in December 2021. However, after three inquiries, the company withdrew its application for listing on the GEM. This is related to the company's lack of innovative attributes and too big a gap with the positioning of the GEM.

China's vast territory, different economic levels, and food habits have created different tea drinking cultures, each with its representative varieties, so it isn't easy to grow a national brand.

In this view, even if Bama Tea comes back on the main board, whether this can solve the problem of tea companies being listed is still uncertain.