China’s upper-midscale hotel chain, Atour Hotel has officially filed a prospectus with the SEC to raise up to USD100m in an IPO, as reported by 36kr on June 8. The underwriters include BofA Securities, Citigroup [C:US], CICC [601995:CH], and CMB International. The proceeds will be used to enhance Atour’s hotel network, develop new services, increase the stickiness of VIPs and improve the IT infrastructure.
Founded in 2013, Atour offers a range of products and services to guests through offline and online channels, including its mobile app and WeChat applet. In 2020, in terms of scale, the hotel chain became the largest hotel chain in China's high-end hotel market, with 418 hotels and 48,439 rooms. The second place, Heyi Hotel, had 183 hotels and 21,369 rooms. As of March 31, Atour operated 608 hotels and 71,121 rooms. In addition to boosting the number of rooms, Atour has also developed an IP-based retail business within its hotels, which is its core capability. More specifically, the hotel operator has given its rooms different themes such as football-type hotels and cartoon-type hotels by collaborating with Hupu Sports, NetEase [NTES:US] Cloud, Zhihu [ZH:US], and Tencent [0700:HK]. Atour's current in-room product range covers more than 1,100 stock keeping units (SKUs). The prospectus shows that for the past 2019, 2020, and 1Q21, the earnings of Atour were RMB1.57bn, RMB1.57bn, and RMB420m, respectively, with corresponding net profits of RMB64.960m, RMB42.05m, and RMB12.67m, respectively.