The hot pot chain Badu has firmly established itself as the leader in the quality hot pot segment.
On June 17th, Badu, founded by Du Zhongbing, updated its IPO prospectus.
Disclosures show its revenue reached 2.85 billion yuan in 2025, a year-on-year increase of 23.4%, with adjusted profit hitting 320 million yuan, a substantial surge of 88.7%.
Compared to the previously disclosed 145 stores, Badu opened approximately 55 new outlets in the following 12 months, bringing its total store count to 200.
Amid a challenging consumer environment for the dining sector, Badu not only maintains strong momentum but has also matched or even surpassed key operational metrics of the industry leader, Haidilao.
For instance, in 2025, Badu's table turnover rate reached 3.6 times per day, approaching Haidilao's rate of 3.9 times per day, with Badu's rate increasing by about 0.4 times per day last year.
Badu's same-store sales grew by 4.8%, significantly outperforming Haidilao's decline of -6.7%.
Particularly noteworthy is that Badu's average customer spending far outpaces its competitor.
Its average spend per customer in 2025 reached 139 yuan, which is 43.3 yuan higher in absolute terms than Haidilao's 95.7 yuan (for its mainland China restaurants), representing a 45% premium.
Haidilao built its reputation on service.
Facing such an established incumbent, Badu's valuable strategy has been to avoid the cutthroat path of low-cost alternatives and instead respond to the rising demand for quality consumption, carving out a new "product-centric" path.
This approach has not only created its own success but also provided a benchmark for differentiated competition within the industry.
According to the prospectus, Badu plans to open 177 new stores over the three years starting from 2026, demonstrating a confident and resilient pace for future development.
Operational Strength and Growth Trajectory
In terms of its developmental stage, Badu, led by Du Zhongbing, exhibits a drive reminiscent of Haidilao a decade ago.
By the end of 2025, Badu operated 180 directly-owned stores, roughly equivalent to Haidilao's total of 176 stores (167 domestic) at the end of 2016.
At that time, Haidilao's core operational metrics included an overall table turnover rate of 4.5 times per day, a store gross margin of 25.5%, with restaurants typically achieving their first break-even within 1-3 months and most realizing net profit within 6-13 months.
Building on this solid single-store model, Haidilao subsequently expanded rapidly, reaching a peak of 1,597 stores by mid-2021—an approximately 8-fold increase in about 5 years, with revenue growing around 420%.
Similarly, Badu today possesses a robust operational foundation.
Its table turnover rate has consistently improved from 3.0 times per day in 2022 to 3.6 times per day in 2025, with a store operating profit margin of 24.9%.
Its operating restaurants also typically achieve their first break-even within 2-4 months of opening, with an investment payback period of under 14 months.
Like Haidilao a decade ago, Badu essentially succeeds with each new store opening, demonstrating a pattern of "instant success" and predictable growth.
The main gap compared to Haidilao is revenue scale, which is determined by their different developmental stages.
In 2025, Haidilao's restaurant revenue was around 40 billion yuan, with growth nearly stagnant.
In contrast, while Badu's scale is an order of magnitude smaller, it is catching up quickly.
For example, since 2023, its store count has grown from 86 to 200, a surge of 132.6%.
Furthermore, from a sales-per-square-meter perspective, Badu performs better.
Its monthly sales per square meter skyrocketed from 1,600 yuan in 2022 to 2,650 yuan in 2025.
Haidilao's average monthly sales per square meter is generally estimated at around 2,000 yuan.
While Haidilao's average spend per customer in mainland China has long struggled to break the 100 yuan mark, Badu's has remained stable in the 140-150 yuan range, all while maintaining an upward trend in table turnover—a particularly challenging feat.
Currently, Badu successfully operates 200 directly-owned stores nationwide, providing strong reason to believe its quality hot pot business model is fully validated and ready for rapid, scaled replication.
The Core of Product-Centric Philosophy
Within the hot pot industry, Haidilao's service-oriented philosophy is considered a benchmark, forming its unique moat and contributing to the narrative that "Haidilao is impossible to copy."
Du Zhongbing, in founding Badu, did not simply replicate the successful formula but chose to focus on the product, organizing all work methods and operational models around a "product-centric" philosophy.
This philosophy emphasizes authenticity, original flavor, health, deliciousness, genuine ingredients, and the pursuit of perfection, forming a systematic operational model.
For example, tripe is a signature dish in Sichuan-Chongqing hot pot and also Badu's specialty.
Its team has refined the tripe product from multiple angles: technique, sourcing, and experience.
Technically, Badu abandoned traditional alkali processing, adopting a unique "papain tenderization technique" to enhance the tripe's crispness and elasticity.
For sourcing, they cross the Pacific to select beef tripe from natural pastures in New Zealand.
For the customer experience, staff perform on-table cutting before serving.
Over 25 years, the Badu team has meticulously perfected every product detail.
All products, like the tripe, have their unique characteristics; for instance, the mushroom broth must use wild mushrooms strictly sourced from the Yunnan-Guizhou Plateau and is freshly brewed daily in each store.
The team's principle for ingredients is "prefer chilled over frozen, prefer natural over added, prefer same-day over overnight."
Financial data confirms the higher costs incurred for these quality products.
In 2025, Badu's raw materials and consumables accounted for roughly 30% of its revenue, meaning over 40 yuan of an average customer's bill was related to ingredients—significantly higher than peers including Haidilao.
This dedication has created Badu's most representative and recognizable signature menu matrix, known as "One King, One Queen, and Twelve Guardians."
Currently, these 14 signature items contribute about 50% of total sales, forming the basis for long-term customer repurchase.
The entire organization's obsession with quality has ultimately driven "snowballing" growth: Badu's membership has grown from about 3.7 million at the beginning of 2022 to nearly 20 million by 2026.
Expansion Potential and Future Outlook
Badu is in a period of rapid expansion with significant potential.
We can use its deeply penetrated Henan market as a benchmark for estimation.
It currently operates 54 stores there.
Given that Henan's revenue from above-scale catering accounts for about 3% of the national total, if Badu achieved its current Henan density across all regions, it could theoretically operate 1,800 stores—exactly 10 times its 2025 count.
In reality, the Henan market is far from saturated, not to mention potential overseas markets, where there are already about 700,000 Chinese restaurants—another vast blue ocean.
It is clear that Badu has vast room for growth.
Currently, Badu only operates in 57 cities, indicating its national expansion strategy is still in its early stages.
According to the prospectus, Badu entered 13 new cities in 2025, with the average first-month table turnover rate for these inaugural stores reaching a high of 4.3 times, demonstrating the appeal and replicability of its product-centric model.
Management has also summarized a "Henan Model": establishing a dense store network in key commercial areas (especially provincial capitals) to build broad consumer awareness and accessibility before expanding to more secondary cities, thereby solidifying dominance in a region.
This methodology is expected to accelerate regional expansion.
Du Zhongbing and Badu have simultaneously established a nationwide supply chain network.
Disclosures show they operate five central kitchens located in Central China (Xinxiang, Henan), North China (Langfang, Hebei), East China (Wuxi, Jiangsu), South China (Dongguan, Guangdong), and Southwest China (Kunming, Yunnan).
Each central kitchen has a coverage radius of up to 600 kilometers, enabling 24-hour fresh delivery.
According to the IPO plan, Badu will open 52, 61, and 64 stores in 2026, 2027, and 2028 respectively, aiming for around 357 stores in three years.
Based on last year's average store revenue of 19.8 million yuan per year, its 2028 revenue could approach approximately 7 billion yuan, representing roughly a 1.4-fold increase compared to 2025.
Over a decade ago, Haidilao defined the golden era of the hot pot industry with its "service-centric" approach.
Today, Badu's "product-centric" model proves another viable path—eschewing price wars and reckless expansion, instead winning price premiums and customer loyalty through genuine ingredients and exceptional experiences.
From 86 stores to 200, and from a table turnover of 3.0 to 3.6, every step Badu takes is solid and determined.
If Haidilao is the formidable mountain, then Badu is carving out its own plateau on the other side, where the view is becoming increasingly expansive.
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