Latest news with #GumingHoldings
CNBC
3 days ago
- Business
- CNBC
China's booming bubble tea industry faces a test: Is it here to stay or just a fad?
Bubble tea may have started as a playful drink, but it has grown into an industry worth billions. The global bubble tea market size will grow from $2.83 billion in 2025 to $4.78 billion by 2032, according to a report from Fortune Business Insights. This year, three Chinese bubble tea chains — Mixue Group, Guming Holdings and Auntea Jenny — listed in Hong Kong, and raised more than $700 million as investors bet on China's fast-growing consumer market. "This is the right place at the right time," said William Ma, chief investment officer at Grow Investment Group, said in an interview with "CNBC Explains." "A lot of global investors are trying to invest in sectors less sensitive to the U.S. tariffs. So domestic consumption, younger generation consumption, is a more stable or less vulnerable sector," Ma added. Mixue has emerged as the sector's heavyweight, operating more than 46,000 stores worldwide by the end of 2024. That makes it the world's largest food-and-beverage chain by outlet count — ahead of McDonald's, Starbucks and Subway. Its ultra-low pricing and high-volume model lean heavily on franchising. "In 2024, they are growing at around 22% in terms of new store growth," Ma noted. Franchising is central to the bubble tea industry. Most large bubble tea chains don't run the shops themselves. Nearly every outlet is franchised. Parent companies earn from supplying ingredients and equipment, and collecting fees, while franchisees shoulder the costs of rent, labor and utilities. That model fuels rapid growth but comes with trade-offs: maintaining quality and avoiding store cannibalization gets harder as outlets multiply. "The normal payback period for the business owner, for the franchisee, is between 18 to 24 months," said Ma, estimating store closure rates at roughly 20% across the market. But overseas expansion is no guarantee of success. CNBC's China reporter Elaine Yu noted that replicating the domestic formula abroad comes with added challenges. "Supply chains are harder to control, and consumer tastes differ from city to city. That's why brands are adapting to regional flavors and different store formats to win over local customers," Yu said. Market saturation at home, rising costs and intense price wars are also testing the resilience of these brands. Whether they can sustain their valuations will depend on their ability to balance scale with profitability — and prove they can build more than just a fad.
CNBC
3 days ago
- Business
- CNBC
Why Chinese bubble tea chains are brewing billions
Bubble tea has gone from a viral drink to a global business worth billions. In 2025, Chinese bubble tea brands Mixue Ice Cream & Tea, Guming Holdings (Good Me) and Auntea Jenny made headlines with Hong Kong IPOs worth hundreds of millions. Mixue now holds the largest market share by store count, with over 46,000 outlets globally – surpassing American-grown F&B chains McDonald's, Starbucks and Subway. As competition heats up and brands race to expand globally, the question is no longer how fast they can grow – but who's built to last. Watch the full explainer by clicking the link above. Chinese bubble tea chains scaled up quickly by using low-cost franchising. But as IPO buzz fades, long-term value hinges on supply chain control, pricing power and brand resilience.
Wall Street Journal
07-07-2025
- Business
- Wall Street Journal
Chinese Bubble Tea Stocks Rise as Food-Delivery Platforms Brew Up Discount War
Shares of Chinese bubble-tea brands advanced as food-delivery platforms have stepped up discounts in a scramble to capture users, boosting tea beverage sales. Sichuan Baicha Baidao Industrial rose as much as 15% on Monday morning in Hong Kong before paring gains to 7.3%. Guming Holdings and Mixue Group were up 7.5% and 3.0%, respectively. Hong Kong's benchmark Hang Seng Index was last down 0.45%.
Mint
22-05-2025
- Business
- Mint
China's Gen Z Stocks Build on Gains as Baiju Makers Stumble
China's so-called new consumer stocks are on a tear. Bubble tea maker Mixue Group jumped as much as 4.7% during intraday trading Thursday, while rival Guming Holdings rose more than 5% at its high. The moves defied a wider lull in Hong Kong's stock market, compounding gains for investors who have bet on Generation Z consumption — an increasingly popular play. Investors are on a feeding frenzy for brands that have appeal to the younger generation, lifting a varied group of shares seen as new consumption plays. That is hurting demand for the shares of companies selling old-fashioned consumer staples, including the makers of hard liquor. The recent gains mean Mixue's market capitalization is now around $27 billion, putting it above that of Luzhou Laojiao Co., one of China's major distillers. The shift followed the bubble tea maker's 170% jump since its initial public offering in February, a move that has helped fuel interest in other listings now in the pipeline. The combined market value of five of the top sellers of boba drinks, including recently-listed companies Auntea Jenny Shanghai Industrial Co. and Chagee Holdings, totaled almost 290 billion yuan as of Wednesday. That is over half the size of Wuliangye Yibin Co., China's second largest distiller and one of the largest stocks onshore. Read: Gen Z's 'Emotional Consumption' Fuels Wild Stock Moves in China Recent government directives reining in the consumption of alcohol at official receptions have dealt a blow to the sector. Luzhou Laojiao's share price has fallen more than 3% since a Sunday notice telling officials to watch their spending on alcohol and cigarettes. Shares of Kweichoi Moutai Co., China's biggest liquor maker, have lost around 2% this week. This article was generated from an automated news agency feed without modifications to text.
Bloomberg
22-05-2025
- Business
- Bloomberg
China's Gen Z Stocks Build on Gains as Baiju Makers Stumble
China's so-called new consumer stocks are on a tear. Bubble tea maker Mixue Group jumped as much as 4.7% during intraday trading Thursday, while rival Guming Holdings rose more than 5% at its high. The moves defied a wider lull in Hong Kong's stock market, compounding gains for investors who have bet on Generation Z consumption — an increasingly popular play.
