In recent years, China's jewelry market has achieved steady growth driven by rising consumer purchasing power and increasingly diversified daily wearing demands. From a competitive landscape perspective, the domestic jewelry market remains primarily dominated by foreign brands. These brands have established multi-dimensional competitive advantages through high quality, high recognition, scarcity, and deep historical heritage, maintaining relatively stable market positions. Facing intense competition from international brands, domestic jewelry companies find it challenging to break through. Against this backdrop, many brands have turned to overseas expansion to broaden their markets.
To prepare sufficient "ammunition" for overseas expansion, after 15 years on the Shenzhen Stock Exchange, Guangdong Chj Industry Co.,Ltd., a paradigmatic "national fashion innovation" company in China's mainland jewelry industry, has chosen to list again, seeking entry to the Hong Kong Stock Exchange.
Recently, Guangdong Chj Industry Co.,Ltd. (referred to as "Guangdong Chj Industry") officially submitted its listing application to the Hong Kong Stock Exchange Main Board, with CITIC Securities serving as its sole sponsor. What highlights does Guangdong Chj Industry bring to the capital market this time around?
**Steady Revenue, Fluctuating Profitability**
According to the prospectus, Guangdong Chj Industry established its core jewelry brand "CHJ" in 1997 and gradually expanded its business based on this foundation, enhancing the brand's influence in the fashion sector. The company leverages the national intangible cultural heritage filigree craftsmanship to drive commercial transformation of traditional techniques and cultural symbol innovation, winning numerous important awards in design and craftsmanship. In 2023, Guangdong Chj Industry was selected as the only mainland Chinese jewelry brand in Forbes' "National Fashion Innovation Brands."
The company emphasizes breakthrough from traditional jewelry paradigms through "culture + design dual-wheel drive," positioning itself not only as a jewelry manufacturer but also committed to conveying modern Chinese aesthetic concepts. The brand positions itself with "youth and fashion" as its core, gradually building a differentiated brand image and product system.
Currently, Guangdong Chj Industry has developed into one of the major fashion jewelry companies in mainland China. According to a Frost & Sullivan report, based on 2024 sales revenue, the company ranks first in China's fashion jewelry market with a 1.4% market share.
The company focuses on the mid-to-high-end market and has established its market-leading position through a comprehensive and distinctive product portfolio, joining the ranks of mainstream jewelry companies in mainland China. CHJ has been selected as one of "China's 500 Most Valuable Brands" for 21 consecutive years and was rated as an "Asia's Top 500 Brand" by the World Brand Lab in 2024.
Jewelry business serves as the company's core business during the reporting period, contributing approximately 90% of total revenue annually. With CHJ as the main brand, the company has formed a multi-brand collaborative development strategy, offering diversified products through different positioned brands including CHJ, CHJ|Soufflé, and CHJ‧ZHEN. Additionally, the company launched Cëvol, a sub-brand focused on the emerging lab-grown diamond market, to cover consumer groups with more differentiated needs.
To enrich its product matrix, the company acquired fashion handbag brand FION in 2014, which primarily targets young customers.
As of June 30, 2025, the company operated a total of 1,542 offline jewelry stores. Specifically, the company's sales network includes 201 self-operated stores and 1,337 franchise stores in over 200 cities nationwide, plus four overseas stores, including one self-operated store in Malaysia, one franchise store in Thailand, and two franchise stores in Cambodia.
The company adopts a dual approach, establishing sales points through both self-operated and franchise stores, leveraging the advantages of both operational strategies through this hybrid model to drive growth.
Under this strategy, Guangdong Chj Industry achieved steady revenue growth. In 2022, 2023, 2024, and the first half of 2025, the company recorded revenues of approximately RMB 4.364 billion, RMB 5.836 billion, RMB 6.452 billion, and RMB 4.062 billion respectively.
The company's gross profit also showed an overall upward trend, reaching RMB 1.278 billion, RMB 1.474 billion, RMB 458 million, and RMB 936 million during the reporting period respectively.
However, under the influence of multiple factors including raw material price volatility and intensified market competition, the company's profitability showed a fluctuating downward trend. During the period, the company's gross profit margin declined from 29.3% in 2022 to 22.6% in 2024, with a slight recovery to 23.1% in the first half of 2025.
Meanwhile, the company's profit also showed some volatility. Profits from 2022 to 2024 were RMB 205 million, RMB 330 million, and RMB 169 million respectively, showing a fluctuating downward trend. However, the company's profit rebounded to RMB 333 million in the first half of 2025.
**How to Break Through in a "Red Ocean" Market?**
The company indicated in its prospectus that raw material price volatility and supply instability have impacted its business. During the reporting period, gold accounted for the largest proportion of raw material costs, with particularly profound impact. Gold purchases by the company accounted for 94.4%, 96.6%, 98.3%, and 97.3% of total raw material purchases respectively during the period.
According to Frost & Sullivan data, from 2020 to 2024, China's 9999 gold average annual spot price steadily rose from RMB 387.4 per gram in 2020 to RMB 557.2 per gram in 2024.
At the same time, the vast majority of the company's inventory consists of or is made from gold. During the reporting period, Guangdong Chj Industry's inventory levels remained consistently high at RMB 2.216 billion, RMB 2.247 billion, RMB 2.603 billion, and RMB 2.592 billion respectively.
While gold jewelry typically sells well during gold bull markets with strong gold prices, and inventory turnover days usually shorten significantly during such periods, high inventory levels could pose risks for companies once gold market sentiment cools. The company acknowledges that significant gold price fluctuations could have material adverse effects on its business, operating performance, and financial condition.
However, considering industry conditions and future development trends, the fashion jewelry market remains a sub-sector with considerable development potential. From 2020 to 2024, China's mainland jewelry market grew from RMB 610 billion to RMB 728 billion, with a compound annual growth rate of 4.5%. The overall market is expected to further expand to RMB 937 billion by 2029, with a compound annual growth rate of 5.2% from 2024 to 2029.
This growth is primarily driven by the rise of "national fashion" trends resulting from the fusion of Chinese traditional culture with modern design, and consumers' continued rising demand for personalized and accessible luxury jewelry. Brands are also actively implementing youth-oriented strategies, enhancing digital interaction through live streaming, social e-commerce, and short video platforms to connect with consumers and drive significant online sales growth.
Under the combined influence of consumption upgrades, prominent brand value, and online-offline channel integration, the jewelry industry is gradually developing toward premiumization and differentiation, laying the foundation for long-term growth.
Regarding China's mainland fashion jewelry market that Guangdong Chj Industry focuses on, the market size declined from RMB 284.8 billion in 2020 to RMB 203.8 billion in 2024, with a compound annual growth rate of -8.0%. This decline was mainly due to the enhanced attractiveness and investment properties of gold jewelry brought by significant gold price increases, as well as significant contraction in diamond jewelry demand, intensifying competitive pressure in this sub-segment.
Starting from 2024, the market is expected to gradually recover, potentially reaching RMB 245 billion by 2029, with an expected compound annual growth rate of 3.7% during this period. Factors driving recovery include growing demand for accessible luxury accessories, young consumer groups' enhanced pursuit of personality and style, and the continued influence of digital marketing and social e-commerce.
Notably, this market is highly competitive. Based on 2024 sales revenue, although Guangdong Chj Industry ranks first in China's fashion jewelry market, its market share is only 1.4%, reflecting the industry's highly fragmented nature and low brand concentration.
To further capture market share, Guangdong Chj Industry has chosen overseas expansion. In 2024, the company first expanded its business overseas, successively opening stores at IOI Citymall in Kuala Lumpur, Malaysia, and ICONSIAM in Bangkok, Thailand, formally entering the Southeast Asian market. Since 2025, the company has opened two stores in Cambodia at AEON Mall Phnom Penh and Umall Sihanoukville.
From the perspective of fundraising purposes, global expansion is one of the main objectives of this listing. According to the prospectus, the raised funds will be used for overseas expansion and construction of new production bases. Guangdong Chj Industry plans to open 20 self-operated stores overseas by the end of 2028 to expand its international sales network.
Under the current industry backdrop of coexisting opportunities and challenges, Guangdong Chj Industry continues to advance brand rejuvenation and product differentiation strategies, actively expanding its multi-brand matrix and online-offline integrated sales channels, while accelerating deployment in overseas markets such as Southeast Asia, demonstrating strong market adaptability and growth potential.
In the future, as "national fashion" deepens and consumption recovers, can the company further enhance brand influence, optimize product structure and cost control, and seize opportunities in industry consolidation? This requires continued market attention.
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