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Just listed on the fall, KFC his father why the tragic hanging by Nongfushanquan?

On September 8, Nongfushanquan was listed in Hong Kong, and opened up 85.12%, with a total market capitalization of HK$440 billion.

The owner of Nongfushanquan, Mr. Zhong G睒睒, became the richest man in China, surpassing Mr. Ma Huateng at one point.

Selling water can be sold into the richest, which also makes Nongfushanquan become the focus of public opinion.

But few people know that on September 8, in addition to the listing of Nongfushanquan, there is also a company that is going to be listed, and it is a "secondary listing".

This company is "China's largest restaurant group", with restaurants such as KFC, Pizza Hut and Little Sheep Yum Brands China.

With an offering price of HK$412 per share, Yum China's offering price is lower than that of all Hong Kong-listed IPOs so far.

Thus, Yum China is also known as the "King of Offer Price".

And then it was blown out of the water by the farmer's three punches.

On its first day of trading, Yum China opened at HK$410, which was a bust (i.e., a drop in share price).

Subsequently, the share price continued to go down, the lowest share price of HK$392.4, more than 4% lower than the issue price, the total market capitalization has evaporated more than HK$8 billion.

"Listing is the peak" performance, but also let a lot of people began to focus on Yum.

Although Yum China is the "largest restaurant group in China" with more than 10,000 restaurants, the development of Yum China is relatively uneven.

Why can't Yum beat Nongfushanquan when it goes public at the same time?

The reason may lie with Yum itself.

The first problem with Yum China is that:

They're too dependent on KFC

Let's take a look at Yum's earnings:

36 Krypton is even more straightforward to make a bar chart to explain Yum China's earnings for 2019:

You can easily see: revenues from KFC + Pizza Hut make up a full 90% of Yum China's total revenue.

Nominally Yum China has 7 large restaurant chains, and the only ones that can really fight are KFC and Pizza Hut.

If this were a Moba game, then KFC and Pizza Hut would be the left hand and the water, the golden double C.

There is a KFC trademark behind the left hand...

What's even more exaggerated is that KFC accounts for a large part of the profits, accounting for 68.8% of the profits of the whole Yum group, which can be said to be a one-man flying team.

Pizza Hut's profits were okay in previous years, and have been on the wane in recent years:

Pizza Hut's revenue growth rate was as high as 17.98% in 2017, but it quickly dropped to 0.86% in 2018, and then became negative 2.7% in 2019.

Between 2018 and 2020, KFC's customer unit price has grown steadily through price increases and new launches.

Pizza Hut customer unit price is all the way down, gradually left behind by KFC.

So why is Pizza Hut's unit price declining?

Let me give you an example.

On June 10, I went to Pizza Hut for a buffet, and wrote this article:

This is Pizza Hut after more than 10 years, once again launched a buffet, limited to one week.

I thought I'd have to wait another 10 years to miss this one, but I didn't realize that it had recently launched a buffet again, and I was dumbfounded:

Why is Pizza Hut launching buffet service so often?

There are many possible reasons, such as clearing inventory, improving performance, and so on.

But essentially, Pizza Hut is trying to attract customers through promotions to achieve the goal of "price for volume".

This also confirms the downward trend of Pizza Hut's brand, which is irreversible.

When have you ever seen a buffet at Kee Mee, right, or a bunch of people eating without a buffet?

Do you think so, Mak?

A very real problem is: even if KFC and Pizza Hut take their lives to Carry, the epidemic has also made Yum China defeated.

In the first half of 2020, Yum China's total revenue was $3.656 billion, down 17.4% from $4.428 billion in the same period in 2019.

Then some of you are going to ask:

Why are Yum's other restaurants so food ah, what are they doing?

This point involves Yum's "Chinese dream".

As a foreign company entering China, Yum has always wanted to "localize" and make itself more relevant.

This is evident in the case of KFC.

Now KFC has congee, rice, soy milk, and in the early days even tea eggs:

I went to try the actual picture

But Yum is not satisfied with the Chineseization of its own foreign fast food, and it would like to have its own Chinese restaurant.

But sadly, so far, Yum has been unable to get the Chinese restaurant right, as if it were possessed by a demon, and it's a case of "whoever comes will die.

In 2005, Yum China launched "Oriental White" in Shanghai, aiming to become China's largest Chinese fast-food chain brand

By the end of 2007, **** opened 12 stores in Shanghai:

You're like this.

However, the "Oriental white" has been lukewarm, the development of the lack of energy, as of June 30 this year, the Oriental white only 11 stores.

Full of ambition and pride of the Oriental white, after 15 years of development, still hovering on the edge of the fast food market.

And this is just the first step of Yum's trial and error.

In February 2012, Yum China acquired Little Sheep, then the No. 1 hotpot company, for nearly HK$4.6 billion.

A year later, Yum China once again acquired all the shares of Little Sheep, and owned Little Sheep exclusively.

However, after Yum took over, the number of Little Sheep stores decreased from over 300 to about 200.

To know. At its peak, Little Sheep had more than 700 stores.

After the acquisition, Little Sheep was officially overtaken by a host of competitors such as Haidilao, Gluttony, etc., and gradually faded out of our field of vision

After Yum rolled over again, they picked up where they left off, and then acquired Huang Ji Huang in 19.

As you can see, Huang Kihuang is now also silent, far less influential than in previous years...

A survey in August even showed that many people have not eaten Huang Kihuang for 2-3 years, emphasizing the weakness of Huang Kihuang in recent years.

Yum Yum people are stupid: is it possible that I am incompatible with the Chinese restaurant? How come every Chinese restaurant is not working well?

Yum's heart is particularly bitter, originally it was trying to Chinese and Western double line of development, but now it is good, the money earned from Western food still have to subsidize the Chinese food.

In summary, severe "bias" is a key factor in the market's disapproval of Yum, and the reason why Yum is being beaten by Nongfusanquan.

So, does Yum China still have a chance to turn the tide?

After the halting of Chinese restaurants, Yum set its sights on the 'coffee sector'.

In 18 years, Yum China launched the coffee brand COFFii&JOY.

In 19 years, KFC launched "K Kee Coffee" and spent a lot of money on promotion, the intention is very clear:

"I'm going to enter the coffee market!"

KFC has achieved a good result, as of 2019, KFC has sold 137 million cups of coffee in China.

But the coffee business hasn't been able to make Yum more profitable for Yum, judging from Yum China's listed earnings.

Can Kee Coffee, Lavazza and others dry out Starbucks & Ruixing? It is still an unknown.

All in all, KFC is still a very reliable point for Esaote, as long as KFC does not turn over, Esaote can still rest easy.

As China's largest restaurant company, Yum's financial strength is its biggest advantage.

As long as the general direction stays the same, I think Yum will be able to incubate another great food brand in the future.

Of course, if Yum still wants to develop a Chinese restaurant:

I'd recommend that they have their fortune told, and see if they can break the curse of the dog's head.

Kitchen Humans

Specializing in "the relationship between human behavior and food"

Dedicated to bringing food-related fun facts cooked for you to eat.