Mixue, Guming, and ChaPanda — The Bubbling of Bubble Teas in China?

Ho Su Wei
3 min readMay 23, 2024

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Mixue, Guming and ChaPanda sitting on a tree … K I S S — MAKING MONEY!

There are new titans on the prowl. And they come in bubble tea sizes. Mixue, Guming and ChaPanda are either listed or are applying for listing on the Chinese market this year. The bubble tea craze is now hitting China and also, the world.

And they are not listing for pocket money. ChaPanda was just recently listed on the market, and they obtained about US$330 million in funding. Mixue and Guming are seeking about US$500 million to US$1 billion and US$300 million to US$500 million in funding respectively. Mixue, Guming and ChaPanda are the 1st, 2nd and 3rd biggest bubble tea chain in China now.

Beverage Consumption Has Been a Bright Spot

Let’s set some context right. China has struggled in the past two years. A zero-covid policy that was effective at the height of the pandemic went very wrong at the low of it. 2022 was a bloodbath for China as it only registered a growth of 3.0%. 2023 can be considered the year that the dragon will rise, but instead, a panda came slumbering through. The year registered a ‘steady’ growth of 5.2%. Things were certainly disappointing for the second-biggest economy in the world.

But amid the ashes of its fire, emerged an unlikely bright spot. Bubble tea. And boy oh boy, did Chinese consumers love this. It’s strange that the Chinese would love such a thing that in my knowledge came from Taiwan. According to Statista, the sales of bubble tea in China almost doubled from RMB76 billion in 2017 to RMB124.6 million in 2022. This is projected to grow to RMB192 billion by 2027.

And Gen-Zs have been driving this trend in China. Just like Starbucks becoming trendy, bubble teas also came to dominate the taste buds of the younger generation. They grew up in the 2000s, and bubble tea is a way for them to hang out.

Good Time to List on the Market?

Drop it like it’s hot, or in this case, list it while it’s hot. 2023 and 2024 are the right times for bubble tea companies to list themselves. Investors are still willing to pay a premium for such companies. The latest listing of ChaPanda saw it garnered a price-to-earning valuation of 17.8 times, which is above the Chinese stock market ratio of 9.9 times.

However, that valuation seems to be too unfeasible for many investors in the market now. ChaPanda actually dropped the ball, with its share price losing almost 40% on its very first day. Right now, it is trading at a price of HKD10.62, which is below the listing price of HKD17.50.

The Test Now is Mixue

ChaPanda’s case exhibits the perils and risks of investing in the Chinese market. There are just too many things to take into account. The recent tariffs by the U.S. on Chinese electric vehicles have basically shoved a middle finger to the Chinese markets. ChaPanda debut is a sobering reminder that no matter how much Chinese consumers like your products, they still face a lot of scrutiny.

Mixue’s listing will be crucial here. It is the biggest bubble tea chain in China by far. It owns more than 30,000 chains in China itself. If the listing of Mixue also flops, there is something very wrong with the Chinese markets and economy in general. But this presents an opportunity for those who adhere to fundamental research and long-term investing.

There are Always Opportunities

This might be a good opportunity. China markets are trading at a price-to-earning ratio of 9.9 times. This is low compared to other global markets. If you do fundamental research, you will know that there are always undervalued companies to look at. We just have to dig in, and wait for such opportunities.



Ho Su Wei

Founder of Slice of P.I.E and hopes to provide simple investment, economics and personal development insights to ordinary people.