Grabbing a bite of the Fast Food market
Grabbing a bite of the Fast Food market I initiated a mid conviction position into the secondary offering of Yum China on 10/09/20 at the price of HKD 395.80. I believe there is a strong growth story and recovery in consumer spending in the Chinese market. CEO Joey Wat has already proved to be capable in turning around the aging KFC franchise in China and introduce a culture of innovation, technology integration, and operational efficiencies to grow the franchises. What I like Simple understandable free cash flow generative business. From an operational cash flow perspective, YumCn has powerful food products and franchises that already have a good track record of success like KFC, Pizza Hut, Taco bell. Unlike most food companies that employ a globalisation strategy and failed to enter target markets (Dunkin in India, Starbucks in Australia), YumCn is focused on glocalisation to adapt its products to local tastes. This is important as Northern Chinese and Southern Chinese had differenc