BRIEF: Xiao Noodles launches Hong Kong IPO to raise up to $89 million

Chinese noodle-chain operator Guangzhou Xiao Noodles Catering Co. Ltd. (2408.HK) launched its Hong Kong public offering on Thursday, aiming to raise up to HK$690 million ($89 million) by selling 97.3 million shares for between HK$5.64 and HK$7.04. The stock is set to make its trading debut on Friday next week.

Founded in 2014, Xiao Noodles specializes in Sichuan-Chongqing noodle cuisine and operates a chain of 451 restaurants across 22 Mainland Chinese cities, with an additional 14 outlets in Hong Kong, and 115 more stores under development. The company’s revenue rose 34% year-on-year in the first half of this year to 703 million yuan, while its net profit surged 96% to 41.83 million yuan.

According to its latest prospectus, Xiao Noodles has secured HHLRA, Guotai Junan Securities, Junyi Hong Kong Fund, Shengying Investment, Zeta Fund and Haidilao Singapore – a wholly owned subsidiary of hotpot chain Haidilao – as cornerstone investors for the listing, with total commitments of about $22 million.

Xiao Noodles said it will use the IPO proceeds to expand its restaurant network, upgrade its restaurant technology and digital systems, enhance brand building, invest in potential upstream food-processing projects and support its general corporate operations.

By Lee Shih Ta

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