Gemilai Holdings Limited, a semi-automatic Italian coffee machine brand, has officially commenced its listing process on the Hong Kong Stock Exchange, with CITIC Securities acting as the sole sponsor. According to the prospectus, the funds raised from the IPO will be used over the next five years for expanding production facilities and digitalization, developing brand marketing and service systems, and enhancing research and development capabilities.

From 2023 to the first nine months of 2025, Gemilai reported total revenues of 308 million yuan, 498 million yuan, and 449 million yuan, with year-on-year growth rates of 61.7% and 44.1%, respectively. Annual profits were recorded at 22.005 million yuan, 40.006 million yuan, and 53.972 million yuan, increasing by 81.8% and 363.4% year-on-year. Based on 2024 revenue, Gemilai held approximately 16.0% of the market share in semi-automatic Italian coffee machines and a leading 27.9% share in split-type semi-automatic coffee machines.

Despite its dominance in this niche segment, Gemilai faces risks due to high concentration in both product categories and geographic regions. The company's core product is the split-type semi-automatic Italian coffee machine, which requires a separate grinder. In 2024 and the first three quarters of 2025, revenue from home, home-commercial, and commercial Italian coffee machines consistently accounted for over 85% of total revenue, while their sales volume represented 20% to 30%. Home-use Italian coffee machines contributed more than 40% of total coffee machine revenue and approximately 70% of total sales volume. In the first nine months of 2025, the average selling price for this category increased by 32.8% compared to the full-year 2024 average, driving a significant 46.9% year-on-year revenue growth in the segment. This indicates that home-use Italian coffee machines are both the performance backbone and a key growth driver for the company.

Geographically, Gemilai's primary market is domestic, with revenue from China rising from 69.7% in 2023 to 80.9%. However, its overseas performance has been disappointing. During the reporting period, revenue from Asian countries such as Vietnam, Indonesia, the Philippines, Thailand, and Malaysia declined from 16.7% to 14.3%, while revenue from the U.S. market dropped sharply from 10.1% to 2.3%. By September 30, 2025, revenue from other markets, including various European and South American countries, decreased by 16.2% year-on-year, accounting for just 2.5% of total revenue, nearly 2 percentage points lower than the same period in 2024.

Whether the strategy of focusing on split-type semi-automatic Italian coffee machines and targeting domestic individual consumers can sustain Gemilai's long-term growth remains uncertain. On one hand, consumer education for home coffee machines in China is still in its early stages. Semi-automatic machines have a higher usage barrier compared to fully automatic and capsule coffee machines, and split-type models are more complex to operate and clean than integrated grinders. On the other hand, Gemilai's prices, often reaching several thousand yuan, lack competitive edge. Entry-level semi-automatic Italian coffee machines from leading brand DeLonghi are priced at half the cost of Gemilai's most affordable Owl series, while small appliance brands like Bear Electric and Xiaomi offer split-type semi-automatic models for as low as a few hundred yuan.

Additionally, Gemilai competes with major instant coffee, ready-to-drink coffee, and chain coffee brands. For general consumers, the convenience and accessibility of coffee beverages partly explain the slow adoption of home coffee machines. This means Gemilai's target customers are coffee enthusiasts who value flavor and enjoy the brewing process, limiting the potential market size. According to optimistic projections by Frost & Sullivan, the domestic split-type semi-automatic Italian coffee machine market is expected to grow at a compound annual growth rate of approximately 25.2% from 2024 to 2029, reaching a total scale of 4.3 billion yuan. In contrast, estimates from iiMedia Research and China Research普华 Industrial Park suggest China's overall coffee industry market size could reach 1.4 trillion yuan by 2029.

To expand its market reach, Gemilai should ideally increase R&D investment to diversify its product portfolio. However, during the reporting period, the company's R&D expense ratio consistently declined, falling from 6.7% in 2023 to 3.7% in the first nine months of 2025. In comparison, sales and marketing expenses accounted for 20.2%, 22.0%, and 21.1% of total revenue, with marketing and promotion costs alone exceeding同期 R&D spending.

The prospectus indicates that due to increased e-commerce sales, platform service fees and promotion expenses rose significantly with sales volume. By September 30, 2025, over 70% of Gemilai's sales and marketing expenses were attributed to marketing and promotion. Given that home coffee machines are low-frequency durable goods, if product sales equate to new customer acquisitions,粗略 estimates show the customer acquisition cost was approximately 249.76 yuan in 2023 and 449.74 yuan in the first nine months of 2025, a cumulative increase of 80.1%.

Surprisingly, despite explosive profit growth during the reporting period, Gemilai retained very little cash on its books. From 2023 to 2024, annual net profit increased from 22.005 million yuan to 40.006 million yuan, but net cash and cash equivalents only increased by 365,000 yuan and 5.5 million yuan, respectively. In the first three quarters of 2025, net profit nearly quadrupled year-on-year, yet net cash and cash equivalents decreased by 3.024 million yuan. As of September 30, Gemilai's short-term interest-bearing debt was approximately 30.817 million yuan, while liquid funds stood at only 22.519 million yuan.

The primary outflow of cash stemmed from financing activities, particularly dividend payments to shareholders. In 2023 and 2024, the company declared cash dividends of 25 million yuan and 25 million yuan, accounting for 97.8% and 81.4% of net outflow from financing activities, and 113.6% and 62.5% of net profit for each period, respectively. In the first nine months of 2025, Gemilai distributed another 80 million yuan in dividends, approximately 1.48 times its net profit for the period.

Prior to the formal application, founder, board chairwoman, and executive director Xie Jianping held a 47.24% stake in the company through entities GenCore International and BrewBond Capital. Based on this, Xie received approximately 61.412 million yuan from the total 130 million yuan in cash dividends distributed over the past two years and nine months. The move to raise funds through an IPO while distributing substantial dividends has raised questions about the company's listing motives.

Another notable detail is that several of Gemilai's senior executives are veterans of Fiyta Precision Technology Co.,Ltd., an A-listed watch precision manufacturing company. According to the prospectus, executive director and CEO Ye Shusheng previously worked at Fiyta for 12 years,最终 holding the position of deputy general manager. Executive vice president Zhang Chunlai, responsible for sales, spent nearly 16 years at Fiyta as general manager of the sales and marketing department. Vice president Zhu Yinglin, overseeing production, was with Fiyta for almost 14 years, serving as manager of the engineering technology department, assembly department manager, and deputy general manager of R&D and quality, and manufacturing. Assistant president Liang Jia, supervising quality control, spent 12 years primarily responsible for building Fiyta's quality management system and product structure. Assistant president Ouyang Zhuangjie, in charge of e-commerce and overseas sales operations, was deputy general manager of the e-commerce business department at a Fiyta subsidiary from 2013 to 2019.

Additionally, Gemilai's independent non-executive director Liu Biao previously served as head of Fiyta's finance department. One of the company's liaison secretaries, Lai Junjie, held positions as regional business manager and planning operations manager at Fiyta. From upstream production to downstream sales, Gemilai's core management roles largely replicate Fiyta's team. While this approach may reduce internal磨合 costs, it also carries governance risks such as homogenized business strategies, overlapping supply chains and customer relationships, and reliance on key individuals.