INDUSTRY Information

INDUSTRY Financial Information

Haidilao International Holding Ltd. operates within the restaurant chain industry that served
soups and broth, specifically focusing on the hotpot dining segment.

The Chinese food industry experienced a robust compound annual growth rate (CAGR) of
10.7% from 2013 to 2017.Looking ahead, the sector is projected to sustain its growth
momentum with an expected CAGR of 9.6% from 2017 to 2022. The hotpot cuisine market in
China has demonstrated robust growth in lower-tier cities and rural areas, achieving a
compound annual growth rate (CAGR) of 11.5% from 2013 to 2017. Looking ahead, this
segment is projected to maintain strong momentum, with an anticipated CAGR of 10.2% from
2017 to 2022. In 2017, Hotpot cuisine captured the largest market share among Chinese
culinary offerings, constituting 13.7% of the market.
Financial
Comparison of 2015 2016 2017 COMPOUNDED
Haidilao Vs Revenue Revenue Revenue ANNUAL
Industry in China (in Billion) (in Billion) (in Billion) GROWTH RATE
Haidilao ¥5.50 ¥7.20 ¥9.70 32.8% Better Than Industry Growth
Industry ¥27.70 ¥33.00 ¥40.80 21.4%

Haidilao ranks first among all Chinese cuisine brands, hotpot restaurants, the largest Chinese cuisine companies, and China-ba
e companies, and China-based restaurant groups that have expanded overseas.
 Description December 2015 December 2016
Revenue 5756682 7807686
Other income 35663 62094
Raw materials and consumables used -2599740 -3179281
Staff costs -1571877 -2044292
Property rentals and related expenses -269482 -298367
Utilities expenses -221483 -262985
Depreciation and amortization -239179 -285918
Travelling and related expenses -67214 -84483
Listing expenses
Other expenses -268113 -372422
Share of profit of an associate
Other gains and losses 8072 12012
Finance costs -23221 -8167

Profit before Tax 560106 1348177

Income tax expense -149462 -367686
Total Profit for that Period 410682 978191
Items that may be reclassified subsequently to profit or loss
Exchange difference arising on translation of foreign operations 148 5539
Total Comprehensive Income for that Period 410830 983730
Profit for that period attributable to:
Owners of the company 272693 735169
Non-controlling interests 137989 243022
Total Profit for that Period 410682 978191
Comprehensive income attributable to:
Owners of the company 272013 740708
Non-controlling interests 138817 243022
Total Comprehensive Income for that Period 410830 983730
Earnings per Share Basic (in ¥) 0.06 0.16
December 2017 June 2017 (Unaudited) June 2018 (Unaudited)
10637470 4756065 7342644
90753 40037 26986
-4313230 -1949182 -3066735
-3119699 -1390723 -2202717
-418625 -218596 -272301
-348577 -148862 -254635
-359839 -179347 -320497
-119598 -47985 -72387

-444998 -160933 -301373

26062 18186 18216

-8166 -8158 -8774

1625050 757977 909918

-430708 -204828 -253507
1194432 553149 647411

-30507 -13868 6156

1163835 539281 653567

1027485 424804 646488

166497 128345 923
1194432 553149 647411

997338 410936 651602

166497 128345 1965
1163835 539281 653567
0.21 0.09 0.13
 Description December 2015 December 2016 December 2017

Revenue 5,756,682 7,807,686 10,637,470

Revnue Growth rate 35.63% 36.24%

Raw materials and consumables used -2599740 -3179281 -4313230 -45%

COGS Growth rate
Gross profit 3,156,942 4,628,405 6,324,240

Staff costs -1571877 -2044292 -3119699 -27%

Property rentals and related expenses -269482 -298367 -418625 -5%
Utilities expenses -221483 -262985 -348577 -4%
Travelling and related expenses -67214 -84483 -119598 -1%
Other gains and losses 8072 12012 26062 0.14%
Other expenses -268113 -372422 -444998 -5%
Other operating expenses total -2,390,097 -3,050,537 -4,425,435

Adjusted EBITDA 766,845 1,577,868 1,898,805

PBT 560106 1348177 1625050

EBIT -23221 -8167 -8166

EBIT 583327 1356344 1633216

Depreciation -239179 -285918 -359839

EBITDA 822506 1642262 1993055

 Av Dec-18 Dec-19 Dec-20

14,460,141 19,656,522 26,720,270

35.94% 35.94% 35.94%

-41% -41% -42% -6093879 -8283769 -11260616

8,366,262 11,372,753 15,459,654

-26% -29% 28% 4,048,839 5,503,826 7,481,676

-4% -4% 4% 578,406 786,261 1,068,811
-3% -3% 3% 433,804 589,696 801,608
-1% -1% 1% 144,601 196,565 267,203
0% 0% 0.140% 20,244 27,519 37,408
-5% -4% 5% 723,007 982,826 1,336,014
5,948,902 8,086,693 10,992,719

2,417,360 3,286,060 4,466,935

28331.927
424.5
66.74187750294
 Expected
Dec-21 Dec-22 Dec-23 Dec-24 Dec-25 Dec-26

36,322,440 49,375,236 67,118,671 77,186,472 88,764,442 102,079,109

35.94% 35.94% 35.94% 15% 15% 15%

-15307220 -20808007 -28285552 -32528385 -37407642 -43018789

21,015,220 28,567,228 38,833,119 44,658,087 51,356,800 59,060,320

10,170,283 13,825,066 18,793,228 21,612,212 24,854,044 28,582,150

1,452,898 1,975,009 2,684,747 3,087,459 3,550,578 4,083,164
1,089,673 1,481,257 2,013,560 2,315,594 2,662,933 3,062,373
363,224 493,752 671,187 771,865 887,644 1,020,791
50,851 69,125 93,966 108,061 124,270 142,911
1,816,122 2,468,762 3,355,934 3,859,324 4,438,222 5,103,955
14,943,052 20,312,972 27,612,621 31,754,514 36,517,692 41,995,345

6,072,168 8,254,257 11,220,498 12,903,573 14,839,108 17,064,975

Dec-27 Dec-28 Terminal

117,390,975 134,999,621 141,749,602

15% 15% 5%

-49471607 -56892348 -59736965

67,919,368 78,107,273 82,012,637

32,869,473 37,799,894 39,689,889

4,695,639 5,399,985 5,669,984
3,521,729 4,049,989 4,252,488
1,173,910 1,349,996 1,417,496
164,347 188,999 198,449
5,869,549 6,749,981 7,087,480
48,294,647 55,538,844 58,315,786

19,624,721 22,568,429 23,696,851

 Description December 2015 December 2016 December 2017
Current Assets
Inventories 41065 49707 95118
Trade and other receivables and prepayments 175473 246878 497616
Bank balances and cash 157569 406876 282032
Total current assets 374107 703461 874766
Liabilities
A/P 385015 483747 679454
Total current liabilities 385015 483747 679454

Net working capital -10,908 219,714 195,312

Increase in net woking capital 230,622 -24,402

Parameter 2015 2016 2017 Average 2018

Inv days 5.77 5.71 8.05 6.51 108,640

A/R days 11.13 11.54 17.07 13.25 524,812
%of sales 2.7% 5.2% 2.7% 4% 510,910
1,144,361

A/P days 54.06 55.54 57.50 55.70 929,888

929888

214,473

19,161
 2019 2020 2021 2022 2023 2024 2025 2026

147,681 200,751 272,892 370,959 504,266 579,906 666,892 766,926

713,407 969,777 1,318,275 1,792,009 2,435,983 2,801,381 3,221,588 3,704,826
694,510 944,088 1,283,354 1,744,539 2,371,455 2,727,173 3,136,249 3,606,687
1,555,598 2,114,616 2,874,522 3,907,507 5,311,705 6,108,460 7,024,729 8,078,439

1,264,052 1,718,301 2,335,787 3,175,174 4,316,201 4,963,631 5,708,175 6,564,402

929888 929888 929888 929888 929888 929888 929888 929888

291,545 396,315 538,734 732,333 995,504 1,144,830 1,316,554 1,514,037

291,545 396,315 538,734 732,333 995,504 1,144,830 1,316,554 1,299,564

 2027 2028

881,965 1,014,260 1,064,973

4,260,550 4,899,633 5,144,614
4,147,689 4,769,843 5,008,335
9,290,205 10,683,735 11,217,922

7,549,062 8,681,421 9,115,492

929888 929888 929888

1,741,143 2,002,314 2,102,430

1,449,597 1,605,999 1,563,695

 2015 2016 2017 2018E

Adjusted EBITDA 766,845 1,577,868 1,898,805 2,417,360

(+/-)Changes in
230622 -24402 19160.7644213488
working capital
(-)Capex 936,000
(-)Stock-based
compensation
Free Cash Flow (for
766,845 1,347,246 1,923,207 1,462,199
valuation)

WACC 6.8% ₹ 69,298,563.81

Terminal growth rate 3.00%

₹ 225,260,772.47
D/E 0.015
V/E 1.015 424.5 M
E/V 0.985222 Number of share
D/V 0.014778 Price of the Share ₹ 42.45
Re 6.90%
Rd(1-tc) 3.40%
 2019E 2020E 2021E 2022E 2023E 2024E

3,286,060 4,466,935 6,072,168 8,254,257 11,220,498 12,903,573

291545.482438137 396314.975280959 538734.328237 732333.357365 995503.93987993 1144829.53086

2,994,514 4,070,620 5,533,434 7,521,923 10,224,994 11,758,743

323,193,101.22 155,962,208.66

424500000
5306250000
 2025E 2026E 2027E 2028E Terminal Year

14,839,108 17,064,975 19,624,721 22,568,429 23,696,851

1316553.960491 1299564.29014355
1449597.13031 1605999.02938111 1,563,695

13,522,554 15,765,410 18,175,124 20,962,430 22,133,155