The Hidden Concerns Behind Wanchen Group's Rapid Performance Growth

(Source: Beijing Business Daily)

As Wanchen Group, the “No. 1 snack retailer in bulk” company, has moved its Hong Kong stock listing process into a “pause.” On March 23, Wanchen Group submitted its IPO prospectus for the Main Board of the Hong Kong Stock Exchange. Because the hearing and/or listing had not been completed within 6 months from the submission, it was deemed “invalid.”

But at the same time, Wanchen Group delivered an impressive set of results. According to financial report data, in 2025, Wanchen Group’s revenue was RMB 51.459 billion, up 59.17%; its net profit attributable to shareholders was RMB 1.345 billion, up as much as 358.09%. Among them, bulk-buy snack retail became an absolute pillar of performance. In 2025, Wanchen Group’s bulk-buy snack business revenue was RMB 50.857 billion, up 59.98%, accounting for as much as 98.83% of total revenue. By the end of 2025, the company had 18,314 stores. Its core brand, “Haoxianglai,” became the first bulk-buy snack retail brand nationwide to surpass 10,000 stores in store count.

In fact, since it transformed into the bulk-buy snack business in the second half of 2022, Wanchen Group has achieved rapid growth in performance through fast store expansion and acquisition-driven integration of brands to broaden its footprint. From 2022 to 2024, Wanchen Group’s revenue was RMB 549 million, RMB 9.294 billion, and RMB 32.329 billion, respectively, with year-over-year growth of 26.35%, 1592.03%, and 247.86%. However, when the timeline is extended, compared with the nearly 16-fold increase in 2023 and growth of over 200% in 2024, Wanchen Group’s revenue year-over-year growth rate in 2025 fell to less than 60%. Looking at each single quarter, in 2025—Q1 through Q4—the company’s revenue year-over-year growth rates were 124%, 93%, 44%, and 27%, respectively, with the growth rate narrowing quarter by quarter.

Meanwhile, Wanchen Group’s pace of store expansion also showed signs of slowing. The financial report shows that in 2025, Wanchen Group had a net increase of 4,118 stores, down 58% year over year from 9,776 stores in 2024. The number of store closures increased 96.7% year over year to 602 stores, and they were mainly concentrated in East China and Central China regions, where store share is the highest.

Behind the rapid expansion, financial leverage risk still exists. As of the end of 2025, Wanchen Group’s total liabilities were RMB 7.497 billion, and its asset-liability ratio was as high as 74.61%. Although this was lower than 79.85% in the prior year, it still remained at a high level.

Jianghai, a senior research fellow at Pangu Think Tank, said: “High liabilities mean the company needs to bear high interest expenses, which will compress the company’s profit margin space and reduce the efficiency of capital use. Slower expansion may also lead to market share being taken by competitors, affecting the company’s market standing. For example, ‘Mingming Very Busy’ currently has more than 21,000 stores nationwide, achieving a lead in store scale. In this situation, high leverage risk may trigger tightness in the capital chain, impacting the company’s ability to sustain operations and development.”

“Currently, the competitive logic of leading companies in the bulk-buy snack industry has changed significantly. In the past, companies may have focused more on expanding store count to occupy the market with scale advantages. But as the industry surpasses 45,000 stores, the market becomes increasingly saturated, and the competitive logic shifts toward refined operations and differentiated competition. Companies need to enhance profitability per store, optimize supply chain management to reduce costs, and strengthen brand building to improve consumer loyalty,” Jianghai said.

Zhu Dianpeng, a China food industry analyst, said that the growth of bulk-buy snack enterprises is not driven by improvements in revenue per store, but mainly by expansion in the number of stores. This growth model is essentially “only quantity, not quality,” and lacks sustainability. Judging from the situation in practice, the industry’s store closure rate is also rising further. In terms of the Hong Kong stock market, regulators and investors have higher requirements for the operating quality of companies, while behind the low-priced bulk-buying model there often come issues of low quality. This is undoubtedly the biggest challenge faced by related companies when listing in Hong Kong.

Regarding questions such as when the company will submit a new application again and its store expansion strategy, a reporter from Beijing Business Daily sent an interview request letter to Wanchen Group. However, as of the time of publication, no reply had been received.

In the announcement released by Wanchen Group on March 20, the company emphasized that it will steadily promote work related to its H-share listing application. Through preparations for a Hong Kong listing, it will further improve its governance system and align with international regulatory standards.

Beijing Business Daily reporter Tao Feng Wang Yuyang