CHONGQING - Two hotpot restaurant chains are cooking up plans to list on the Nasdaq stock market within the next two years as part of their attempts to expand overseas.
Chongqing Liuyishou Hotpot Co Ltd, based in the southwestern municipality, said it plans to go public within one or two years.
"We will make every effort to get listed on the Nasdaq before 2012," said Liu Song, the company's president. "To achieve this goal and learn about the developed market, we will also set up some overseas outlets this year. We plan to establish a branch in Singapore this month, one in Hong Kong in June and another in the United States in August."
"Compared with the domestic market, the markets in the developed countries and regions are more mature and the experience gained from operating branches overseas will benefit the sound growth of our domestic business," he added.
Liuyishou had revenue of 2 billion yuan ($300 million) in 2010, compared with 1.8 billion yuan in 2009. The company has 400 chain stores and franchised outlets on the Chinese mainland.
"We plan to increase annual revenue to 2.3 billion yuan and expand the number of chain stores and franchised outlets to 450 this year," Liu said.
Another hotpot company based in the municipality, Chongqing Little Swan Hotpot Restaurant, has also expressed an interest in a Nasdaq listing.
He Yongzhi, the president of Little Swan, said the company is planning to go public in the US either this year or in 2012.
The company has 62 restaurants throughout China, which earned more than 320 million yuan in 2010.
There are currently no hotpot chains listed in the US.
The attempts to get listed on US stock markets come as the popularity of the spicy cuisine grows.
"The domestic hotpot market is consolidating quickly and has nurtured some well-known brands in recent years," said Feng Enyuan, secretary-general of the China Cuisine Association. "The average annual growth rate of this industry has been more than 20 percent in the past five years, compared with 14 to 15 percent of other types of Chinese cuisine," Feng said. "Going public in the US and stepping into an overseas market will help Chinese restaurant brands to fashion a new presence."
"By exploring the overseas markets, especially in the US, the companies can prove their competitiveness to domestic consumers, which can result in even more popularity domestically," said Wang Zhenhui, deputy secretary-general of the China Hotel Association.
However, some experts said setting up outlets overseas will not be an easy task. Some Chinese food brands have already tried to go overseas but have either failed or abandoned their efforts.
The Little Sheep Catering Chain Co Ltd, a hotpot company based in the Inner Mongolia autonomous region, entered the US in 2005 but it pulled back from the market in late 2009. When asked about its withdrawal, a spokeswoman for the company, who did not give her name, declined to comment.
"With the development of the Chinese economy and as more Chinese people go abroad, the country's cuisine has become increasingly popular in recent years. But the hotpot is still strange to Westerners because of the different eating habits," Wang said.