China’s “little emperors” give investors high hopes for profits.
China’s children’s retail market is gaining strong momentum and could double to 311 billion yuan ($47.33 billion) in 2013 from 165 billion yuan in 2009, according to data from business consultancy Frost & Sullivan.
At the end of 2008, the number of Chinese children aged 0-14 reached 250 million, and in the next ten years, children’s retail will see tremendous growth given the growing economic prosperity in China, according to China Research & Intelligence.
We are seeing companies, both international and domestic, vying for a stronger share of this evolving but competitive market where branding plays a crucial role in winning consumers.
Dadida, a manufacturer and retailer of children’s clothing in China, announced plans to raise US$400 million-US$500 million from an initial public offering. According to insiders, they expect to list on the Hong Kong Stock Exchange as early as September.
The company will use the proceeds from the offering to open stores and expand production facilities.
Dadida has embarked on an aggressive promotion campaign to build brand awareness. Dadida founder Zhao believes that his company will find success competing with big internationals if they build brand differentiation and provide distinctive brand culture, coupled with a home advantage.
Dadida’s listing plan comes less than six months after Boshiwa International Holding, another Chinese retailer of children’s products, raised US$369 million. On the first day of trading, Boshiwa shares soared 41% above the offer price of 4.98 Hong Kong dollars (64 U.S. cents) as rising spending on children’s apparel and products in China has captured investors’ interest.
photo credit: dadida