Spicy snack company files for Hong Kong IPO
Business & Technology
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Weilong Delicious (卫龙美味), a leading snack brand famous for their spicy strip-shaped chips, filed for IPO in Hong Kong on Friday.
- The cheap chips are becoming a popular snack (like Cheetos in the U.S.), and have become popular on Chinese social media, sometimes featuring in viral videos (in Chinese).
- The company has a dream team of investors including Sequoia, High Tide, Tencent, Yunfeng Fund, which have collectively invested about half a billion dollars.
The context: The company already filed for an IPO in May, but like many Chinese companies, it let the application lapse following a procession of weak listings and mounting regulatory pressure.
- In 2020, Weilong boasted an annual revenue of 2.6 billion yuan ($400 million). Estimates place the company at a whopping $10 billion valuation.
- That has made the snack founder Liu Weiping 刘卫平 the second richest man in Henan province.
Also relevant: the company’s success seems, in part, due to its unusually high profit margin. It logged a margin of 38% in 2020, well beyond its competitors and the food and beverage industry average of 30%.
