Chinese hotpot chain Haidilao bets on takeaway, new brands, lower-tier reach for growth

China's leading hotpot chain, Haidilao International Holding, has identified takeaway as its fastest-growing segment, with revenue surging 121.2% year on year to reach 2.05 billion yuan in the first half. The takeaway segment now accounts for 9.2% of the company's total revenue, up from 4.5% a year earlier. Despite a weak macroeconomic environment and intense competition in the catering sector, Haidilao's results were positive, with total revenue increasing 7.9% to 22.34 billion yuan and net profit rising 0.5% to 1.77 billion yuan.

Ivan Su, equity research director at Morningstar, expects Haidilao to continue delivering growth over the coming years due to its operational and supply chain advantages, which allow it to reach lower-tier cities better than most hotpot competitors. The group's dine-in customers spent an average of 97 yuan per meal, showing little change from a year earlier.

Haidilao's dine-in store openings were slow, but they plan to expand further in 2027, including new restaurants in higher-tier cities and mass-market areas in lower-tier cities. The company operated 1,389 restaurants as of June, with 1,267 self-operated outlets in mainland China and 23 in Hong Kong, Macau, and Taiwan. Thirty-two stores closed due to outdated facilities and underperformance.

Since the return of founder Zhang Yong as CEO in January, Haidilao has accelerated investments in new growth initiatives, including expanding its multi-brand business, which now includes burger, sushi, and street-style eateries. Revenue from these segments reached 1.27 billion yuan, jumping 113% year on year. The group's other brands have expanded to 183 restaurants.

Haidilao is also scaling up its food-stall hotpot and sushi formats for large-scale replication during the second half of the year. The company aims to strategically pursue high-quality asset acquisitions to diversify its catering portfolio. Haidilao already has 127 overseas restaurants, primarily in markets such as the US, the UK, South Korea, Japan, and the United Arab Emirates.