After May Day, Haidilao’s stock price continued to fall. Since reaching its peak on February 16 this year, Haidilao's share price has fallen from HK$85.80 to its lowest level of HK$42.55. As of the close of trading on May 7, Haidilao's share price was HK$43.15 per share. In just 56 days, the 200 billion "hot pot hair" share price has been nearly halved, with a cumulative drop of 47.47%. The latest market value is HK$228.7 billion, which is more than HK$200 billion lower than the highest market value in February.
After Labor Day, Haidilao’s stock price continued to fall. It fell by more than 6% on May 5, plummeted by nearly 10% on May 6, and plummeted again on May 7, hitting a record of HK$42.55 per share for the whole year. New low. Since the high point on February 16 this year, Haidilao's stock price has fallen from 85.80 Hong Kong dollars to the lowest point of 42.55 Hong Kong dollars, and the stock price once plummeted 50.41%.
As of the close of trading on May 7, Haidilao’s share price fell 2.92% to HK$43.15 per share. In just 56 days, the stock price fell by nearly half from its February high, with a cumulative drop of 47.47%. The latest market value is currently HK$228.7 billion, which is HK$208.5 billion less than the highest market value in February.
As for the plunge in Haidilao’s stock price, Chinese food industry analysts told the media that first of all, there are few holidays in the second quarter, which is the off-season for the catering industry. In addition, Haidilao's stock price has been at a false high in the name of "the number one hot pot brand". This kind of correction is normal.
As of the closing price on May 7, Haidilao’s total market value was HK$228.7 billion, with a price-to-earnings ratio of 622 times. Looking around, in the entire Hong Kong stock market, there are very few consumer stocks with price-earning ratios as high as 600 times.
A comprehensive brokerage institutional research report shows that most institutions are focusing on 50 times Haidilao’s 2021 valuation forecast. Among them, Guoyuan Securities stated that based on the company's current recovery and store opening expectations, Haidilao's earnings per share from 2021 to 2023 will be 0.89 yuan, 1.39 yuan and 1.72 yuan respectively, and the corresponding valuations will be 48.9 times, 31.5 times and 25.4 times respectively. times.
Morgan Stanley released a research report, which quoted Haidilao's management as saying that in April this year, the overall turnover rate at its restaurants was less than 3 times. Although it rebounded to around 70% in the same period of 2019, it dropped from 3.5-3.7 times in March, and the performance was lower than market expectations. During the May Day holiday from May 1 to May 5, Haidilao’s overall transaction rate was approximately 4.5 to 5 times.
Some people in the industry believe that as can be seen from the recent continued decline in stock prices, the rapid expansion of stores is not a panacea for stimulating optimistic capital. Problems such as reduced brand awareness, single profit model, and declining competitiveness of service models have become The obstacles for Haidilao to maintain high-quality growth. As inflation expectations rise and U.S. bond yields soar, market sentiment has subsided and some high-value restaurant giants have been sold off.
Since the Spring Festival this year, Hong Kong stocks’ leading restaurants have fallen sharply. Except for Haidilao, Jiumaojiu fell by 17%, Xiaqixiaxi plummeted by nearly 50%, and its stock price almost halved.
In 2020, it earned 2 billion less than in 2019, but its stock price soared by more than 91%
Affected by the epidemic, 2020 will be the most difficult year for Haidilao's operations.
In March this year, Haidilao released a performance report showing that in 2020, Haidilao Group achieved revenue of 28.6 billion yuan, a year-on-year increase of 7.8%; the annual net profit was 309 million yuan, a year-on-year decrease of 86.8%. According to the company's announcement, the decrease in net profit was due to the reduction in store traffic caused by the epidemic and the net exchange loss caused by exchange rate fluctuations.
Haidilao’s net profit in 2019 was 2.347 billion yuan, which means that it will earn 2.038 billion yuan less in 2020 than in 2019.
On the one hand, net profits have shrunk significantly, and on the other hand, the expansion rate of Haidilao stores has not slowed down. In 2020, Haidilao opened 544 new stores in Haidilao, and the global store network increased to 1,298, with an average of 1.5 stores opened per day, a new high since the company was founded.
However, the drawbacks of rapid expansion are becoming apparent. The decline in churn rate and the increase in operating costs are dragging down Haidilao's performance. In terms of turnover rate, Haidilao has begun to peak, and the financial report shows that the store turnover rate has dropped again after 2019.
In 2020, Haidilao’s churn rate was 3.4 in first-tier cities and 3.6 in second-tier, third-tier and below cities. Compared with 2019, Haidilao's turnover rate is 4.7 in first-tier cities, 4.9 in second-tier cities, and 4.7 in third-tier and below cities.
The turnover rate dropped and net profit dropped significantly, which attracted market attention. According to the CICC report, Haidilao's expected net profit performance last year was lower than expected. As the turnover rate has not yet recovered and the expansion of new stores is faster than expected, the company's profit forecast for 2020-22 has been reduced by 74%, 5% and 3% respectively, reflecting that it will take time to recover customer flow. On the other hand, more and more new hot pot brands are emerging on the market. Hot pot brands such as Banwu, Dezhuang, and Xia Shu are all popular for their differentiated characteristics, threatening Haidilao's leading position.
Although 2020 is the most difficult year for Haidilao to operate, its stock price has soared rapidly. Haidilao is known as "hot pot hair" and is highly sought after by institutional funds.
In 2020, Haidilao’s stock price soared by more than 91%.
The "Hot Pot King" is keen on cross-border, and now sells "fried chicken" after Maocai and Gaimian.
In recent years, Haidilao has been keen on cross-border. After expansion and price increases, Haidilao also came up with other "tricks" - opening up new brands and creating the nth brand.
Currently, Haidilao has created many new brands through internal extension and other strategies: Externally, in 2019, it successively acquired “Youdingyou” to enter the field of maocai, acquired “Hao Noodles”, “Hanshe Zhonghua” Cuisine" has entered the field of pasta and various Chinese catering; internally, in 2019, Sun Company successively launched "Diaoyu Pie Noodles" and "Xin Qin Style Noodle House"; in 2020, it launched new brands such as "Fan Fanlin" and "Qin Xiaoxian", launching 9.9 Yuan’s milk tea is available for selection, increasing the milk tea category.
After Chinese food categories such as chicken vegetables, noodles, and potato noodles, "fried chicken" has recently been sold in Haidilao. It is reported that Haidilao's new brand "Miao Shixiong Fresh Fried Chicken" has landed in Zhengzhou and opened two stores. According to the official WeChat account information of "Miao Ge Fresh Fried Chicken", the brand belongs to Zhengzhou Miao Ge Catering Management Co., Ltd. According to public information, the company is owned by Beijing Youdingyou Catering Management Co., Ltd., a wholly-owned subsidiary of Haidilao Holdings Pte. Ltd. 100% investment.