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Naixue's Tea: From Internet-Famous Tea Brand to First HK-Listed Tea Stock, to Losses and Transformation

Founded: Peng Xin, Zhao Lin · Shenzhen Naixue's Tea Catering Management Co., Ltd.

JOURNEY

Key Fields

FIELD STAMPS
IndustryFood & Beverage
RegionChina
ScaleGiant
ChannelOther

Origin

In 2015, Peng Xin and Zhao Lin opened the first "tea + soft European-style bread" concept store in Nanshan District, Shenzhen, aiming to fill the market gap for high-end tea paired with freshly made light meals. Through the differentiated combination of freshly baked artisanal soft European-style bread and selected tea leaves, it quickly became a popular check-in spot for young consumers, establishing the brand's initial high-end and fashionable positioning and accumulating a large initial user base for subsequent expansion.

Milestones

2015
Startup Validation Stage PMF
The monthly operating revenue of the first store in Nanshan District, Shenzhen, exceeded 6 million RMB, with daily customer traffic exceeding 2,000 visits and over 100,000 related exposure posts on social platforms. It topped the local tea beverage popularity list in its very first month of opening, validating the market demand for the "freshly made tea + freshly baked soft European bread" combination, and initially proving the single-store profitability model.
2017
Tier-1 City Expansion Stage Growth
The number of nationwide stores exceeded 50, with annual operating revenue of approximately 870 million RMB and a gross profit margin maintained at around 35%. It successively entered core business districts in Tier-1 cities such as Beijing and Shanghai, becoming a representative brand in the high-end category of China's new-style tea market, with brand awareness rapidly rising among young groups.
2021
HK Listing Stage Turning Point
Listed on the Main Board of the Stock Exchange of Hong Kong on June 30, 2021, with an issue price of HKD 19.8 per share, raising approximately HKD 3 billion in its IPO, and a peak market capitalization exceeding HKD 35 billion. It became the "first stock of new-style tea" on the Hong Kong stock market, securing sufficient capital for supply chain construction and nationwide store layout, kicking off a period of rapid expansion.
2021
Profitability Validation Stage PMF
Achieved a full-year net profit of 14.46 million RMB, with total stores exceeding 800 and an average customer ticket size maintained around 40 RMB, validating the single-store profitability feasibility of the high-end direct-run tea model. In the same year, it was selected among China's Top 100 Catering Enterprises, and capital expectations for its performance reached a peak.
2022
First Loss Stage Failure
Impacted by recurring epidemics and homogeneous industry competition, annual operating revenue was approximately 4.29 billion RMB, a year-on-year decline of about 10%, with a net loss of about 1.33 billion RMB. Around 70 inefficient stores were closed, marking the first annual loss and signaling that the previous capital-driven rapid expansion model was unsustainable.
2023
Strategic Transformation Stage Transition
Annual operating revenue reached approximately 5.16 billion RMB, a year-on-year increase of about 20%, with net loss narrowing to about 680 million RMB and total stores exceeding 1,300. At the same time, prepackaged soft European bread retail products were launched, and franchise licensing was officially opened, transitioning from a pure direct-run model to a dual model of "direct-run + franchise + retail" in an attempt to find new profit growth points.

Turning Points

  • The 2020 Hong Kong stock listing became a watershed moment for development, bringing capital support while amplifying valuation commitment pressures.
  • The first annual loss in 2022 marked the company's complete shift from scale-oriented to profit-first strategy.
  • Opening franchises and launching prepackaged soft European bread in 2023 marked a dual-scenario transformation from pure To C stores to "stores + retail".

Failures & Pitfalls

  • Failing to maintain the freshly baked texture of soft European bread during supply chain prefabrication, triggering a decline in reputation among loyal users.
  • Blind expansion into lower-tier cities led to lower-than-expected revenue in some stores, with overall store profit margins consistently staying below 30%.
  • Excessively high valuation expectations from the capital market for high-end tea drinks, followed by sustained underperformance after listing, causing the stock price to drop by over 96% from its peak.

关键成功要素

  • The differentiated combination of "tea + soft European bread" pioneered a new high-end tea track, forming early core brand barriers.
  • The direct-run model guaranteed product and service standardization, supporting the establishment of early high-end brand positioning.
  • Post-listing capital-driven rapid expansion exceeded the carrying capacity of the single-store profitability model, leading to deteriorated unit economics.
  • Faced with homogeneous competition, supply chain prefabrication and model diversification transformation became critical to brand survival.

Lessons

  • New consumer brand expansion must use single-store profitability as its core decision-making basis to avoid sacrificing long-term profits for scale.
  • Product quality is a core brand asset; supply chain optimization must not come at the expense of user experience and taste.
  • Post-listing management needs to balance capital expectations with actual operational pacing, preparing contingency plans for performance fluctuations in advance.
  • High-end positioning requires matching continuous product innovation and operational efficiency improvements, otherwise it is easily replaced by homogenized competitor products.

Core Data

  • 2022年营收：4.29 billion RMB
  • 2022年净亏损：1.33 billion RMB
  • 2023年门店总数：1,300 stores
  • 2020年IPO募资额：3 billion HKD
  • 2023年营收：5.16 billion RMB
  • 2023年净亏损：680 million RMB
  • 创始人2025年年薪：3.1 million RMB

Competitors / Peers

Main competitors include Heytea, Chabaidao, Lelecha, and other new-style tea brands. Heytea achieved revenue of around 10 billion RMB in 2023 with over 900 stores, maintaining its leading position in the high-end market through continuous product innovation and strong supply chain capabilities; Chabaidao's 2024 revenue exceeded 6 billion RMB with over 8,000 stores, focusing on the cost-effective route in sinking markets; Lelecha focuses on young user community marketing with over 400 stores. Naixue initially seized the high-end track through soft European bread differentiation, but in recent years has gradually fallen behind competitors in cost control, lower-tier market deployment, and product innovation speed, with its market share coming under noticeable pressure.

Sources

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⚠️ This entry draws on self-reported accounts and public reporting, not independently verified, and is not investment, startup, or legal advice; revenue figures are case-specific and not representative of typical results.