BAMA TEA (06980) Wang Wenli: Slow is fast, use "muscle growth" to cross the cycle.

On March 27th, BAMA TEA (06980) released its first annual report since going public: in 2025, the revenue was 2.196 billion yuan, a year-on-year increase of 2.5%; of which the revenue in the second half of the year increased by 9.65% year-on-year, and the net profit increased by 30.92% year-on-year. Core categories such as Oolong tea and black tea grew by over 7%. The year-on-year online instant retail GMV increased by 90% in 2025. By the end of 2025, the number of national chain stores reached 3,773, with a net increase of 269 stores throughout the year. The brand and products have gained wide market recognition, consistently ranking first in multiple areas: the number 1 in the 2025 China Tea Enterprise Brand Value TOP50, number 1 in the world tea enterprise brand ranking in China, number 2 globally, and number 1 in tea chain store customer satisfaction for three consecutive years. Behind this report card is the result of BAMA TEA Chairman Wang Wenli's 33-year long "slow" persistence. In an interview with "China Entrepreneur", he summarized this persistence as "muscle growth" - not following trends, not speculating, not chasing scale, but using brand strength and product strength to drive healthy growth. "Proactive Gear Shifting": From scale-oriented to quality-oriented In the first half of 2025, BAMA TEA's revenue and profit both declined year-on-year. For a company striving to go public on the Hong Kong Stock Exchange, this was not a favorable number. However, six months later, BAMA's performance bounced back strongly - with a 9.65% increase in revenue and a 30.92% increase in net profit year-on-year in the second half of the year. Behind this "V-shaped reversal" is the proactive adjustment made by BAMA at a critical point in the listing process. Before going public, Wang Wenli did two things: he proactively stopped the low-price promotion model and made a strong effort to rectify the chaotic pricing in the franchisee channel, resulting in a loss of millions in the short term. Looking back on this decision in an interview with "China Entrepreneur," Wang Wenli recalled, "At that time, they thought the chairman was crazy. But what we want is 'muscle growth,' not 'tumor growth.' The annual report data confirms the value of Wang Wenli's decision: in the second half of 2025, BAMA's revenue increased by 9.65% year-on-year, far exceeding the performance of the first half; more importantly, the transformation of e-commerce shifted from "promoting sales volume" to the new track of "quality e-commerce." At the core of this structural change is the switch of growth momentum - from reliance on promotion-driven "volume-oriented growth" to brand strength and product-driven "quality-oriented growth." Wang Wenli summarized this in "China Entrepreneur" as follows: the former is "tumor-like growth" - good in numbers, but overdrawing the brand; the latter is "muscle growth" - healthy and sustainable. "Just Making Tea": Focusing on Building Core Barriers The annual report data reveals another significant structural change in BAMA's growth: the growth rate of core categories such as Oolong tea and black tea exceeding 7%, becoming one of the main drivers of growth. This strategic focus aligns with BAMA's recent years of strategy to "focus on core categories and build super factories." BAMA's choice is to deepen the industrial chain. Currently, BAMA's Tieguanyin and Rock Tea are both produced 100% in-house, and in the future, more super factories will be built to cover categories such as Pu'er tea and white tea. Three years ago, the Shenzhen government allocated land to BAMA for building headquarters, with an initial payment of over 80 million yuan made, however, Wang Wenli changed his mind and invested the money into super factories instead. This decision, which goes against conventional wisdom, has been a consistent theme throughout Wang Wenli's entrepreneurial career. In 1993, he left his job in Shenzhen and returned to his hometown of Xiping Town in Anxi to start Xi Yuan Tea Factory (the predecessor of BAMA TEA), where he stayed for over a decade. During those ten years, Shenzhen's GDP grew sixfold, and property prices in major cities started to rise rapidly, with many people around him urging him to invest in real estate, but he never wavered. "I always felt that if you really want to accomplish something, you must focus." Wang Wenli said in an interview. This focus has translated into the results of BAMA's years of operation: the sales volume of the three major tea brands - black tea, rock tea, and Tieguanyin - consistently rank first in the industry; in the core tea production areas of Anxi and Wuyishan in Fujian, BAMA has been the top taxpayer in the tea industry for multiple years; and the scale of offline stores ranks first among Chinese tea brand chain stores. "Slow is Fast": The Ultimate Return of Long-Termism The annual report shows that after the "proactive consolidation" in the first half of 2025, BAMA's operational quality has entered a new upward trend. Wang Wenli judged in an interview with "China Entrepreneur" that the two key words for the future of the Chinese tea market are: concentration and growth. According to Frost & Sullivan data, the raw tea market in China will increase to 356.4 billion yuan by 2026; in 2024, the combined market share of the top 5 high-end tea companies in China was only 5.6%, with the number 1 ranking BAMA TEA accounting for approximately 1.7%. "As a leading brand, BAMA will also gain greater dividends during the industry adjustment period." Wang Wenli said. However, he is not in a hurry to expand. "There are many things we can do now, but we cannot be too fast, otherwise we might lose speed. We have always been steady and cautious over the years, as long as we are on the right path, sometimes slower is better." This "slowness" translates into a five-year development cycle for the "Sai Pearl" product; a gradual transition to 100% self-production in core categories in factories; and the optimization of stores to create more image, service, and customer experience-focused urban meeting spaces, focusing on improving individual store efficiency. From starting a business at 23 to today, Wang Wenli has spent 33 years turning BAMA TEA into a high-end tea brand with the largest market share. His business philosophy is not complicated: seeing the trends, staying focused, and maintaining quality. "The size of a company does not matter, it's about the timing." He said in an interview, "As long as we are on the right path, sometimes slower is better." This discipline may be the key that helps BAMA TEA navigate through market cycles.