For Bama Tea (06980.HK), which spent 12 years pursuing a public listing, the real test has only just begun following its Initial Public Offering (IPO).

Records show that while Bama Tea's share price touched the 100 HKD milestone within two days of listing, that momentum quickly dissipated over the following four months. As of March 2, 2026, the company's stock price has plummeted by 70% from its peak, with its market capitalization shrinking to HK$2.372 billion.   The continuous erosion of market value is mirrored by fatigue in the company’s fundamentals. As market enthusiasm fades, investors are taking a cold, hard look: can the growth logic of an enterprise rooted in a 300-year-old tea-making family legacy withstand the long-term scrutiny of the capital markets?  

**Stock Price Rollercoaster: From Doubling to Dropping Over 40% Below Offer Price**  

NewTimeSpace has learned that Bama Tea was founded in Shenzhen in 1997 by the Wang brothers. Descending from a 300-year lineage of tea masters, the company’s Chairman, Wang Wenli, is the 13th-generation heir to the Tieguanyin (Iron Goddess of Mercy) legacy. However, the company’s road to listing was fraught with obstacles. Since initiating its IPO in 2012, the company went through a listing on the National Equities Exchange and Quotations (NEEQ) and two failed attempts at the A-share market before finally successfully listing on the Hong Kong Stock Exchange (HKEX) in 2025.  

On October 28, 2025, Bama Tea debuted on the HKEX with the halo of the "First Stock of High-End Chinese Tea," with an offer price of HK$50. On the first trading day, the stock rose to HK$93.35, an increase of 86.70%, bringing its market cap close to HK$8 billion. The following day, the price briefly surged to HK$115, effectively doubling from the IPO price and reaching a peak market cap of HK$9.775 billion. However, the stock subsequently corrected sharply, closing that day at HK$96.15.  

It is understood that at the time of listing, fewer than 9 million shares were truly free-floating for trading. The initial surge in stock price was driven largely by speculative play, with a heavy trading volume of 4.22 million shares on the first day—a turnover rate approaching half of the circulating shares.  

Just three days after listing, on October 30, 2025, Bama Tea announced a plan to convert nearly 32 million domestic shares held by 11 shareholders into H-shares. Although such a conversion requires regulatory approval and does not enter circulation immediately, the market interpreted this as a signal that original shareholders were seeking an exit channel. Concerns over a future increase in supply immediately triggered a downward trend in the stock price.  

As of March 2, 2026, Bama Tea’s closing price stood at HK$27.90, down over 70% from its peak and representing a 44.20% drop from its offer price. Furthermore, since the beginning of February 2026, Bama Tea has been increasingly marginalized by the capital market. Over the past 18 trading days, the total turnover was only HK$27.46 million, with an average daily turnover of less than HK$1.6 million.

From a valuation perspective, the correction is even more stark. As of March 2, 2026, the company’s Price-to-Earnings (P/E TTM) ratio is 11.11x, while the average P/E for the Hang Seng non-alcoholic beverage industry is nearly 28x. This significant valuation discount reflects the market's cautious attitude toward its business model.

Performance "Stall": High-End Narrative Faces Growth Challenges

Bama Tea uses its narrative as the "Leader of High-End Chinese Tea" as its core brand identity. However, against this premium backdrop, its financial data paints a picture of decline.

From 2022 to 2024, the company’s revenue grew slowly from RMB 1.818 billion to RMB 2.143 billion, with the growth rate falling off a cliff. While the company maintained a 16.77% growth rate in 2023, it plummeted to a mere 0.99% in 2024.

Entering the first half (1H) of 2025, the situation worsened as Bama Tea saw simultaneous declines in both revenue and net profit, signaling a severe challenge to its growth narrative.

Data shows that in 1H 2025, Bama Tea’s revenue was RMB 1.063 billion, down approximately 4.20% year-on-year; net profit was RMB 120 million, down approximately 18.01% year-on-year; and the net profit margin dropped to 11.3%. The company explained that the decrease in income was primarily due to a decline in sales from offline channels, while rising administrative expenses further eroded profits.

Additionally, prospectus data indicates a decline in the spending power of repeat customers. From 2020 to 2024, the average annual purchase amount per member at offline direct-operated stores fell from RMB 2,860.4 to RMB 2,469.6, a drop of 13.6%.

NewTimeSpace has learned that Bama Tea’s product strategy is built on a "three-pillar" brand matrix: the core "Bama Tea" brand covers all categories of high-end loose-leaf tea; the sub-brand "Xinjihao" focuses on high-end vintage Puer tea; and the new brand "Wanshanhong" targets younger consumers.

It is understood that the average selling price of "Xinjihao," the high-end Puer brand heavily promoted by the company, continued to slide from RMB 901 per kilogram in 2022 to RMB 715 in 1H 2025. This downward price trend reflects the dual pressures of weak demand in the high-end market and insufficient brand premium capability.

Expanding Nearly 1,000 Stores in Three Years; Franchise Model Faces Revenue Decline

Despite the obvious decline in performance, Bama Tea’s offline store expansion has been remarkably rapid.

NewTimeSpace has learned that as of mid-2025, Bama Tea had over 3,500 stores nationwide, with franchised stores accounting for a high 93% of the total. Approximately half of the company's revenue is derived from selling products to these franchisees.

Data from the end of June 2025 shows that the company's nationwide store count reached 3,585. Compared to 2,613 stores at the beginning of 2022, the company added a net total of 972 stores in three years, a growth rate exceeding 37%. As of the end of June, Bama Tea owned only 244 direct-operated stores, representing just 6.8% of the total store count.

However, a contrast exists between store expansion and declining offline revenue. In 1H 2025, offline channel revenue was RMB 680 million, down 5.3% year-on-year, confirming a downward trend in per-store revenue.

Furthermore, the book value of Bama Tea’s inventory stands as high as RMB 444 million, with an inventory turnover period reaching 168 days. In its prospectus, Bama Tea stated that the number and performance of franchisees and franchised stores have a material impact on revenue; if franchisees perform poorly or reduce cooperation, the company's performance will be hit.

It is worth noting that while Bama Tea faces fundamental difficulties, the overall Chinese tea market is growing considerably.

Data shows that by sales revenue, the Chinese tea market grew from approximately RMB 288.9 billion in 2020 to approximately RMB 325.8 billion in 2024, and is expected to reach approximately RMB 407.9 billion by 2029, with a Compound Annual Growth Rate (CAGR) of approximately 4.6%. The high-end tea market is showing even stronger momentum, with a CAGR of approximately 3.7% from 2020 to 2024, and an expected CAGR of approximately 5.6% from 2024 to 2029.

Overall, there is precedent for the capital market's cautious stance on tea enterprises. Lancang Ancient Tea, which listed before Bama Tea, has seen its share price fall over 70% from its offer price, while Tenfu Tea, which listed even earlier on the HKEX, has faced long-term stagnation in its stock price.

As investors begin to soberly evaluate the sustainability of Bama Tea's growth logic, more tests await before the company's stock price can stage a recovery.

NewTimeSpace Disclaimer: All content herein is the original work of NewTimeSpace. Any reproduction, reprinting, or use of this content in any other manner must clearly indicate the source as "NewTimeSpace". NewTimeSpace and its authorized third-party information providers strive to ensure the accuracy and reliability of the data, but do not guarantee the absolute correctness thereof. This content is for reference only and does not constitute any investment advice. All transaction risks shall be borne by the user.