Controlling shareholder at 1 yuan per share, distributors at 18 yuan per share? Jinxing Beer IPO questioned over "disparate treatment in capital increase"

Ask AI · Venus Beer’s capital increase pricing varies widely—why is regulation closely monitoring possible benefit transfer?

Venus Beer, which is racing to become the “First Chinese-style Craft Beer Stock” on the Hong Kong stock market, is facing severe compliance scrutiny ahead of its IPO, and its path to listing may take on new twists.

Recently, the China Securities Regulatory Commission (CSRC) International Department issued the “Requirements for Supplementary Materials for Overseas Issuance and Listing Filings”, requesting additional materials for Venus Beer’s overseas listing filing. Six major issues—covering the company’s past capital increase pricing, share transfers, and the compliance of its employee incentive plan, among others—have been put under regulatory questioning.

On January 13, Venus Beer submitted an application for a Main Board listing to the Hong Kong Exchanges and Clearing Limited (HKEX). The breakout popularity of its flagship “Venus Maojian” tea beer has helped drive this Henan-based brewery toward the capital markets’ door; this is already its third attempt at an IPO. Under the rules, the company must supplement regulators with explanations of various legal matters within 30 days.

Zuo Yu / Photo

Controlling shareholder capitalizes at 1 yuan per share

Venus Beer’s capital structure and the pricing of its capital increases are key areas regulators are focusing on.

From the equity structure perspective, Venus Beer is a typical family business. The prospectus shows that the company’s founder and controlling shareholder, Zhang Tieshan, together with his son Zhang Feng, hold approximately 93.45% of the company’s shares in total through direct and indirect means.

A reporter noted that the company completed three capital increases between 2024 and 2025, showing a pattern of “different prices for the same batch of capital increases.” The controlling family subscribed at a low price of 1 yuan per share; the price for the employee platform was 6 yuan per share; and for distributors it was 18 yuan per share—the stark differences have drawn market attention.

Looking at the details: in September 2025, Zhang Tieshan subscribed for 20 million shares at a price of 20 million yuan; Zhang Feng subscribed for 18 million shares at 18 million yuan, corresponding to a per-share price of only 1 yuan. Meanwhile, the employee and founder-family-related shareholder platform “Wancaihe” subscribed for 12 million shares for a total of 72 million yuan, averaging 6 yuan per share.

In December 2025, Venus Beer completed its third round of capital increases. The company’s distributor representative platform, “Wancaihe No. 5,” subscribed for 1 million shares at a price of 18 million yuan, averaging 18 yuan per share.

In just three months, the external subscription price rose from 6 yuan per share to 18 yuan per share, tripling the valuation.

If calculated using the market price of 18 yuan, the 38 million shares purchased by the Zhang father and son at 1 yuan per share in September 2025 increased in value to 684 million yuan in only three months—an unrealized gain of over 600 million yuan.

In response, the CSRC requires Venus Beer to explain the pricing basis for the subscriptions by new shareholders, especially the subscription prices of any new shareholders within the 12 months before submitting the listing filing, the reasons for the differences from the capital increase pricing in the same period, and whether such differences are reasonable—i.e., whether there is any benefit transfer. It also requires explanations of whether the participants in the employee incentive plan are company employees, the subscription price and fairness; if there are external participants, the company must explain the reasons for their shareholding, their backgrounds, and the sources of their funds, and whether there is any benefit transfer.

It should be noted that before submitting its prospectus, Venus Beer conducted three “targeted” dividend distributions, which have been questioned by the market as benefit transfer and “early cash-out.”

In 2025, the company cumulatively paid dividends to shareholders of 1.02 billion yuan, 1.27 billion yuan, and 1 billion yuan, for total dividends of 3.29 billion yuan. This amount exceeds the company’s total net profit for the first three quarters of that year (3.05 billion yuan) and is 2.6 times the company’s net profit for 2024 (1.25 billion yuan). Behind these “clearing-out” style dividends is a highly concentrated equity structure, meaning that the vast majority of these dividends flowed into the pockets of the founder’s family.

Relying on flagship products

While regulators focus on compliance, the market is also reassessing Venus Beer’s business model.

Venus Beer’s core products are Chinese-style craft beers. With the explosive popularity of the flagship “Venus Maojian” tea beer, from the first three quarters of 2023 to 2025, the company’s revenue surged from 356 million yuan to 1.109 billion yuan, and net profit jumped from 12.2 million yuan to 305 million yuan.

Based on retail sales, as of the third quarter of 2025, Venus Beer has become the third-largest Chinese craft beer company and the number one flavored craft beer brand, with a market share of 14.6%. Its craft beer business contributed 78.1% of the company’s total revenue.

This also exposes weaknesses in Venus Beer’s business.

In terms of revenue structure, the company is highly dependent on its Chinese-style craft beer business. Sales of traditional beers (including 1982 original beer, pure draft, etc.) have fallen significantly, and their share continues to shrink—making the “single-leg operation” risk prominent.

At present, the annual report window is underway. Judging from performance, companies with a high reliance on flagship products tend to have weaker risk resilience and are more easily outcompeted for market share.

Shu Furong / Photo

For Venus Beer, challenges are already appearing.

A reporter noted that the “tea beer” segment has entered a red-ocean phase, and industry giants such as Qingdao Beer, Yanjing Beer, and Budweiser have all rushed in, leveraging mature supply chains and channel resources to seize market share.

Moreover, because there are no clear domestic regulations for craft beer, and no explicit requirements regarding process standards, brewery production scale, or ownership of breweries, small brands and private-label products promoted by channels such as Hema and Yonghui have sprung up everywhere. A “price war” is beginning to emerge, with the 1L price as low as 6.9 yuan, bringing challenges to the sustainability of Venus Beer’s growth.

Reporter: Shu Furong

Text Editor: Zuo Yu