#78: Retail investors fight over Unitree stock, Abercrombie & Fitch seeks buyers for China business, Alo Yoga opens Tmall store | Following the Yuan
Retail investors fight over Unitree stock, pushing allotment rate to all-time low on Nasdaq-like STAR market as Meituan and HSG bag big wins.
Brands and companies mentioned in this issue: Tencent, ByteDance, Cartier, Canada Goose, Abercrombie & Fitch, Chef Fei, Yum China, Pizza Hut, Luckin, Heytea, JD.com, Unitree Robotics, Meituan, HSG, Alo Yoga, Mammut, CPE
📊 BIG STAT
China AI’s to-consumer business dilemma // In recent months, one question has been hanging over China's booming AI space: who actually pays for AI?
Tencent’s Q2 results (released on Aug 12) show that its capital expenditure jumped to 52.8 billion RMB — nearly triple a year earlier — pushing free cash flow to negative 13.8 billion RMB, though it noted strong willingness among WorkBuddy users to pay via subscriptions and token top-ups.
ByteDance’s Doubao, meanwhile, hit 382 million monthly active users in June, up 172% year-on-year, but pulls in under 1 million RMB a day, according to QuestMobile and Chinese tech publication LatePost, respectively, against compute costs in the tens of millions.
Consumer subscription conversion in China has been marginal but the cost has been skyrocketing. We are reporting on this topic for a deep dive now; more to come.
🎭 CONSUMER CULTURE
Move bricks by day, raise bricks by night // Some young Chinese workers started keep bricks and stones as pets — picking them up off the street, putting them in leftover takeout containers with water, and waiting for moss to grow. It is another unconventional pet hobby, after the mango-pit-raising trend sprouted in the summer of 2023 among a small group of people.
What’s the appeal? Perhaps an emotional feedback that costs nothing and asks for nothing, and a joke that writes itself, since “moving bricks” is Chinese internet slang for grinding away at a job.
💄 FASHION & BEAUTY
Fields Medal Prize winner makes “intellectual style” the new luxury // On July 23, 35-year-old Wang Hong became the first Chinese woman to win the Fields Medal, the most prestigious prize in mathematics, in its 90-year history.
Within days, Chinese consumers had catalogued her entire wardrobe — the Alexander McQueen suit, the Lindberg glasses, an Oura ring stacked beside her Cartier one, a red Canada Goose parka and a The Row tote.
Her Cartier Clash pieces sold out in multiple sizes; even her stationery ran short. What drew netizens wasn’t the labels, but a sensibility shaped by intellect, expertise, and years of accumulated work. [Rachel Zheng wrote about this more in-depth for Jing Daily."]
A&F is said to seek buyers for China business // According to Bloomberg, Abercrombie & Fitch is working with an adviser on a review of its Chinese assets, considering bringing in local partners or selling a stake in a business that could be valued at several hundred million dollars.
The group announced a strategic review of its broader Asia-Pacific business in March, noting that while APAC sales grew 5% last year, returns had not matched its investment. Discussions remain at an early stage.
🍽️ FOOD & BEVERAGE
Chef Fei drops the “Stir-Fried Pork King” crown amid China’s culinary cleanup // Popular restaurant chain Chef Fei, which is due to open its first U.S. store, has quietly dropped its iconic “National Stir-Fried Pork King” claim in China. Instead, its signature greeting is now “cooked by professional chefs.”
The sudden shift follows a massive industry cleanup by the China Cuisine Association, which voided all historical “master chef” and title designations to comply with strict new regulations on official awards.
Yum China becomes Pizza Hut China’s new owner // The $1.2 billion-deal completed on August 7 turned Yum China from Pizza Hut’s exclusive licensee into the brand’s owner in mainland China.
As of March 31, Pizza Hut had 4,375 restaurants across China, and the company is targeting the expansion of Pizza Hut's footprint to over 6,000 stores by 2028. Yum China also operates KFC and Taco Bell in mainland China.
China’s tea chains pour into the alcohol market // From Luckin to Heytea, China’s major tea chains are rapidly embracing alcohol to capture young consumers.
Heytea is experimenting with whisky and custom cocktails at flagship stores, while Luckin continues to expand its spirit-infused lines. Other players—including ChaPanda, No Yeye No Tea, and Mixue—are joining the trend with baijiu infusions, rice-wine teas, or direct craft beer acquisitions. Driven by shifting consumer tastes, China’s low-alcohol market is projected to reach 74 billion RMB by 2025 with a 25% annual growth rate.
🛍️ RETAIL
JD’s food delivery arm launches an AI smart helmet // Announced August 3, the helmet combines a voice assistant, “top-rider routing,” one-touch SOS, and merchant environment verification. It will be given free to JD’s full-time riders first, then rolled out to all riders. The routing feature loads veteran couriers’ accumulated knowledge of navigating residential compounds into voice prompts; riders can accept orders and make calls hands-free in the rain, and the AI helps verify restaurant conditions at pickup, automatically flagging problem merchants.
🧠 TECH
Retail investors fight over Unitree stock as Meituan and HSG bag big wins // China’s humanoid robot darling Unitree Robotics hasn’t even listed on the Nasdaq-like STAR Market yet, but its IPO is already the hottest ticket of the year. 9.78 million accounts have subscribed, pushing the allotment rate down to 0.0181%, an all-time low for the board.
The frenzy has spilled into a grey market: Securities Times learned that intermediaries are buying up new shares through various channels at 410 to 520 RMB apiece, well above the 150.8 RMB issue price, while lucky allotment winners are going online to hunt for buyers themselves.
The listing also mints big wins for early institutional backers: Meituan holds 9.65% as the largest institutional owner, and HSG (formerly Sequoia China)’s 7.11% stake grew out of a 2019 seed investment.
🏃♂️ SPORTS
Alo breaks Tmall record in China retail debut // LA athletic apparel brand Alo launched its first official Chinese online stores on August 12, pulling in 10 million RMB in under a minute on Tmall. Despite complaints of prices higher than its overseas channels, the line’s exclusive e-commerce launch broke a record debut for Tmall’s sports and outdoor category.
CPE acquires Swiss outdoor brand Mammut // Chinese PE firm CPE has signed an agreement to acquire Mammut Sports Group AG from Jacobs Capital, marking the brand’s second ownership change in five years. While financial details were undisclosed, market estimates value the deal over 500 million euros. CPE, which manages over 150 billion RMB, has also invested in Pop Mart, Laopu Gold, Mixue, and Burger King China.
🌍 TRAVEL & TOURISM
China to roll out updated exit-entry rules in September // Effective September 15 under State Council Order No. 841, a new 19-article exit-entry regulation standardizes travel management while protecting national security and citizen safety abroad. Under the rule, foreign affairs and tourism bodies must provide real-time destination risk alerts and safety warnings for Chinese travelers overseas. [We are doing a China color piece on what the people really think.]
Chinese travel agencies are diminishing // More than 2,400 travel agency business licenses were cancelled, revoked, or withdrawn during a first-half crackdown, many of them dormant shells or loss-making storefronts that had already stopped operating. In a survey of 5,000 industry workers, over 90% reported summer bookings down 30–50% year-on-year — with casualties ranging from franchise platforms to a state-backed CTS subsidiary that went into bankruptcy liquidation.
🏥HEALTH
China’s pharma reps might disappear from hospitals // New national rules for pharmaceutical representatives took effect August 1, jointly issued by seven agencies — up from one under the previous system, with the Ministry of Public Security’s inclusion marking a clear escalation. The rules spell out nine prohibited practices, including carrying sales quotas, tracking prescription volumes, and commercial bribery, and for the first time bring contract sales organizations under supervision. Roughly 116,000 representatives are currently registered nationwide.
🗓️ UPCOMING – PICK & CHOOSE YOUR CHINA ITINERARY IN AUG/SEP 2026
Our friend Baiguan released its schedule for Autumn 2026 China tour this week. It’s hosting 2 info sessions on Aug 19 & 20, sign up here.
Aug 19-Aug 23, Pet Fair Asia, Shanghai
Aug 28-Aug 30, Cafe Show China 2026, Beijing