[HK IPO] Meet Xiaomian: A 60x PE Madman! Play small noodles, eat big noodles

Ladies and gentlemen, the long wait is over!
4 new stocks are launching simultaneously, with all funds clashing: Meet Noodles, Tianyu Semiconductor, Naxin Micro, and Zhuoyue Ruixin
Let's start with Meet Noodles. With consumption downgrading and fierce competition in the F&B industry, can this bowl of noodles survive and thrive?
As usual, let's enjoy the feeling of knowledge flowing into our brains....
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1. Company Overview

This is a local F&B company from our great Guangzhou. It started as a small eatery near the back gate of my alma mater, South China University of Technology. Who would've thought it'd actually go public? Emotionally, I support it, but financially, it's hard to back....

Market Share: China's 4th largest Chinese noodle chain, the leader in Sichuan-Chongqing style noodles, with the fastest growth rate among China's top 10 noodle chains, ranking 1st in CAGR from 2022-2024.
Expansion Speed: The F&B industry has been tough in recent years, yet it's been opening stores like crazy—from 133 stores in early 2022 to 465 now. Not only concentrated in mainland tier-1 cities (Guangzhou, Shenzhen, Beijing, Shanghai), but also expanded into Hong Kong (14 stores).

The business model isn't sexy, but the store expansion speed is abnormal.

Hong Kong's newest "Meet Noodles" branch is at MOKO❣️ | U Community Platform

2. Business Moat

Even established chains like Tai Er and Jiumaojiu have been proven to have no moat. I don't know what Meet Noodles' moat is...really, I don't....

3. Financial Data

Big in scale but not strong.

Revenue: 418M RMB in 2022, 1.154B RMB in 2024, with a 66.2% CAGR.

Looks strong on paper, but actually bloated. Don't ask why—it's complicated to explain. Just trust me.

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I won't post the profit and cash flow figures—Meet Noodles' numbers here are very deceptive.

Current Liabilities: Very high. The cash flow it earns is basically all reinvested into opening new stores. This is deadly in business—if a black swan event cuts off the funding chain (e.g., a pandemic), it could easily collapse with no spare cash on hand. This is the ultimate fate of low-margin, no-barrier businesses.

Final Verdict: Not profitable. It's extremely, extremely hard to make money in F&B—that's my conclusion for the entire sector. The business model is squeezed by upstream and downstream players.

4. IPO Structure

1. Sponsor: CMB International

2. Cornerstone Investors: 24.95%, including Hillhouse.

Don't blindly trust Hillhouse—its investments in Haitian and Hesai both fell below IPO price.

3. Public Offering Mechanism: B, 10% no clawback
Retail investors get 9,736,500 shares total, 500 shares per lot = 19,473 lots. Not too few lots, making price manipulation difficult.

5. Valuation

Expensive, really expensive!

1. Market Cap Anchor:

IPO price range: HKD 5.64-7.04, implying a market cap of HKD 4B-5B.

2. PE Derivation

Using 2024 net profit of 60.7M RMB (~65M HKD), if issued at the lower end (HKD 4B), the static PE is a sky-high 61x!

Even optimistically annualizing 1H2025 profit of 41.83M RMB to ~85M RMB (~91M HKD), the dynamic PE is still 44x-55x.

3. Peer Comparison

Jiumaojiu (9922.HK): Noodle expert, previously traded at 12-15x PE, now 40-50x after profit crash.

Haidilao (6862.HK): Hotpot king, PE just 15-18x.

Yum China (9987.HK): KFC/Pizza Hut, ~18x PE.

Their K-lines are all "resting in peace" on the floor.

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My Sharp Take:

Meet Noodles, as a brand that hasn't fully proven its ability to weather cycles, is valued at over 3x Jiumaojiu and Haidilao? This clearly enjoys an extreme growth premium.

Betting it can maintain >50% CAGR in coming years? Any growth slowdown will trigger terrifying multiple compression.

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Conclusion:

1. As we often say in IPO subscriptions: short-term depends on sentiment, long-term on fundamentals, mid-term on structure.

2. Too many red flags in fundamentals (bad sector, overvaluation), and IPO sentiment is weak (B-mechanism's first broken IPO already appeared).

3. Futu's retail placement has started—likely no happy ending (except for Baize Medical earlier this year).
4. Conservative investors must avoid this landmine—"playing noodles ends up eating losses," with potential 50% haircut in 6 months is no joke.
5. Gamblers, go ahead if you want—19,000 lots isn't too many. Play the IPO, play the trash, bet that institutional investors will unite to pump the stock and take you along for the ride.
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Postscript:
Meet Noodles, Tianyu Semiconductor, Naxin Micro, Zhuoyue Ruixin—what do you want analyzed next? Tell me in the comments~

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$MEITUAN(03690.HK) $NOVOSENSE(02676.HK) $XIAO NOODLES(02408.HK) $TIANYU SEMI(02658.HK) $ABLE DIGITAL(02687.HK)