Helen's Chinese Trademark Invalid in Final Ruling, Market Cap Shrinks Over 90%: Hong Kong Stock Pressure Extends from 'Brand' to Operations

Chinese Trademark Ruled Invalid in Final Appeal: Helen's Loses 'Hailunsi'

Have you been to Helen's? Recently, three Chinese trademarks 'Hailunsi,' 'Hailunsi Xiaojiuguan,' and 'Hailunsi Yuedapaidang' were ruled invalid by the final court judgment.

Founded in 2009, Helen's first opened in an obscure storefront in Wudaokou, Beijing. Founder Xu Bingzhong, a retired soldier born in the 1970s, initially targeted the foreign market, such as overseas students.

According to reports, Helen's first used English trademarks like 'Helen's' and applied for a batch of related English trademarks in 2013. However, core Chinese trademarks were not registered until 2018, leading to subsequent trademark disputes.

Interface News reported that the trademark dispute mainly occurred between Chengdu Helen Binbin Hotel Co., Ltd. and Helen's. The former had successfully registered two 'Hailun' trademarks in 2016 in Class 43 (restaurant, bar services). On May 23, 2023, it filed an invalidation request against the 'Hailunsi' trademark, and on August 7, 2024, against 'Hailunsi Xiaojiuguan' and 'Hailunsi Yuedapaidang' trademarks with the National Intellectual Property Administration, claiming that the disputed trademarks were similar to the cited trademarks in terms of services, easily causing public confusion about the source of services.

After three years of back-and-forth, on the evening of June 25, Helen's announced that its three Chinese trademarks were ruled invalid by the final court. The announcement stated that, based on current assessment, the dispute has no material impact on the group's overall business, daily operations, or financial condition, as the group can continue to use its undisputed trademarks in daily operations.

Blue Whale News found that as of now, Helen's offline stores and online communications still use the Chinese name 'Hailunsi' and related expressions. The impact has not yet affected specific stores, but the capital market is more sensitive.

Share Price Fell Then Reflected: Market Cap Shriveled by Over 90% from About 30 Billion HKD

After the announcement, on June 26, the share price opened lower, falling over 6% during the session. By close that day, Helen's share price fell to 1.58 HKD.

Helen's market cap once reached about 30 billion HKD in the year it listed, but now stands at about 2 billion HKD, a decline of over 90%.

From 'First Pub for Young People' to Abandoned by Young People: The Dilemma of Expansion and Transformation

Helen's earliest stores were located in university areas, with the main consumer group being foreigners and international students. Later, founder Xu Bingzhong shifted strategy, positioning Helen's as 'a space for young people to communicate freely offline,' offering 'extreme value for money' with bottled beer priced under 10 yuan and cocktails slightly more expensive but still around 20 yuan.

The 'youth + value' model once succeeded. By the end of 2021, Helen's had 782 stores and listed on the Hong Kong Stock Exchange that year, earning the title 'largest chain pub in China.'

According to Helen's prospectus submitted in 2021, revenue from 2018 to 2020 was 115 million yuan, 565 million yuan, and 818 million yuan respectively; net profit was 9.734 million yuan, 79.136 million yuan, and 70.072 million yuan.

The prospectus showed that in-house liquor with gross margins above 70% contributed over 60% of Helen's alcohol revenue. With factory direct procurement and economies of scale, Helen's also obtained relatively favorable wholesale prices for third-party brand liquors.

However, one advantage was scale. While expanding aggressively, Helen's faced soaring store opening costs. Combined with pandemic effects, net loss in 2021 was 230 million yuan; the next year, net loss widened to 1.601 billion yuan.

After cumulative losses exceeded 1.8 billion yuan, Helen's began closing stores to save itself. Financial data shows that by the end of 2023, Helen's operated 479 pubs, down 288 from a year earlier, a decline of more than 40% from the peak of over 850.

Meanwhile, Helen's launched a strategic transformation from a fully directly-operated model to franchising, i.e., the 'Happy Beer Partner' plan. Initially, the capital threshold for the plan started at a minimum of 600,000 yuan; but by 2024, the investment threshold for new store types was reduced to around 400,000 yuan.

Financials Turn Profitable, but Per-Store Decline and Industry Divergence Remain

Judging from the 2025 financial report, Helen's full-year revenue was 540 million yuan, a decrease of 28.3% year-on-year; net profit attributable to parent was 33.954 million yuan, successfully turning a profit. The share of in-house liquor revenue and gross profit margin improved year-on-year, with store-level contribution gross margin increasing to 73.77%, showing overall improvement over the previous year.

But reality remains grim. Helen's faces a decline in average daily sales per store.

In 2025, the same-store average daily sales per store for directly-operated and franchised stores was 8,500 yuan, a year-on-year decline of over 18%; the overall average daily sales per partner-operated store was only 4,100 yuan, with all store types experiencing a decline in daily sales. The article notes that in the catering industry, where average daily revenue per store often exceeds 10,000 yuan, Helen's franchise store type, which is its main format, earns less. Additionally, nearly 70% of stores are located in third-tier and below cities, putting objective pressure on profitability.

On the other hand, young people have more places to drink, and the appeal of low prices is waning. Zhaimen Canyin shows that the number of newly opened pubs in the past year was as many as 38,000. From Homebars, craft beer pubs, Livehouse-style pubs to various bistros, consumption scenarios are becoming more fragmented and diversified.

Bistros operating 'food + alcohol' have risen strongly in recent years. Within this track, the 'Huanshi' brand, which operates 'food + alcohol,' has developed aggressively. Its parent company, Jiwu Thinking, submitted a prospectus to the Hong Kong Stock Exchange in January this year. Currently, Huanshi has over 100 stores in China, and its 2024 revenue exceeded 1 billion yuan.

Compared to Helen's, which opens up the market with low prices and scale, Huanshi takes a different path. The article mentions its more atmospheric environment and per capita consumption exceeding 100 yuan. The prospectus disclosed that in the first nine months of 2025, its average daily sales per store were 29,880 yuan.

Unlike traditional bar and pub formats, Huanshi extends operating hours to over 18 hours by offering brunch, afternoon tea, dinner, and night drinks, improving per-store utilization and operational efficiency. During the same period, alcoholic beverages and drinks contributed about 45% of revenue, of which 85% were alcoholic drinks; overall gross margin was stable at 68.7%, higher than the industry average.

However, Huanshi also faces challenges. The article points out that high store costs similarly squeeze profits, and consumer complaints about dish taste and quality can affect brand reputation.

China food industry analyst Zhu Danpeng believes that, like the coffee category, low, mid, and high-end brands each have their market. The same applies to pubs. The article indicates that the pub format is pursued by the new generation and is in a period of rapid expansion, but overall concentration is not high. Perhaps after about five more years, driven by capital and consumption dividends, leading brands and a clearer competitive landscape will emerge.

Zhu Danpeng also said that product pricing is not the only key factor affecting brand trends. The hard-core factors determining the future development of pub businesses are mainly brand effect, scale effect, fan effect, supply chain completeness, and per-store operational capability. Since each store is in a different location, strategies should be differentiated.

For Helen's and others, how to operate well in each store may be the biggest challenge.