Sichuan hot pot restaurant chain Haidilao is looking to spice up its global expansion by listing on the Hong Kong Stock Exchange, after filing an application on Thursday.
Hugely popular in China, Haidilao has quietly established a base overseas, and, according to consultancy firm Frost and Sullivan, in terms of revenue it was 2017’s top Chinese cuisine restaurant in China and the rest of the world.
The chain currently has more than 270 restaurants, and announced via its IPO application that it wants to open up to 220 new restaurants just this year.
According to its website, Haidilao’s spicy hot pot is already served to customers in Los Angeles, Singapore, Seoul and Tokyo. With the IPO, the company said it is targeting further overseas expansion.
Rumors of an IPO were reported last month, with Reuters claiming Haidilao would look to raise as much as 700 million US dollars by listing in Hong Kong.
The company made 10.6 billion yuan (1.7 billion U.S. dollars) in revenue in 2017, a 36 percent increase on the previous year, as net profit hit 1.2 billion yuan (188.4 million U.S. dollars).
Despite Haidilao’s focus on customer service and experience, the restaurant came under fire last year for a series of hygiene problems, with rats found in two of its Beijing restaurants.
The company quickly acknowledged the problems and vowed to be open to the public in how it dealt with them. However, one of its overseas branches in Singapore was forced to close for two weeks earlier this year after failing hygiene inspections.
Founded in 1994, Haidilao has seen China’s hot pot industry grow to the extent that the entire market raked in total revenue of 364.7 billion yuan (57.2 billion US dollars) in 2016, according to a CITIC report. That represents more than one fifth (22 percent) of the country’s entire restaurant sector.
BY Nicholas Moore