---
title: "CR Beverage IPO Success: C'estbon's 14.6 Billion Bottles Sold Annually Support a HK$39.1 Billion Valuation"
description: "On October 23, 2024, C'estbon's parent company, CR Beverage (Holdings) Co., Ltd., successfully listed on the Hong Kong Stock Exchange under the stock code \"02460.\" As of the time of writing, the stock surged 15.03% to HK$16.68 per share, giving it a total market capitalization of HK$39.162 billion. CR Beverage is China's second-largest packaged drinking water company, and its flagship brand C'estbon achieved retail sales of RMB 39.5 billion in 2023, with annual sales of 14.6 billion bottles and a market share of 32.7%, ranking first in the purified drinking water market."
author: "New Distribution"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
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published: "2024-10-23"
language: "en"
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---

# CR Beverage IPO Success: C'estbon's 14.6 Billion Bottles Sold Annually Support a HK$39.1 Billion Valuation

> On October 23, 2024, C'estbon's parent company, CR Beverage (Holdings) Co., Ltd., successfully listed on the Hong Kong Stock Exchange under the stock code "02460." As of the time of writing, the stock surged 15.03% to HK$16.68 per share, giving it a total market capitalization of HK$39.162 billion. CR Beverage is China's second-largest packaged drinking water company, and its flagship brand C'estbon achieved retail sales of RMB 39.5 billion in 2023, with annual sales of 14.6 billion bottles and a market share of 32.7%, ranking first in the purified drinking water market.

**On October 23, 2024, C'estbon's parent company, CR Beverage (Holdings) Co., Ltd., successfully listed on the Hong Kong Stock Exchange under the stock code "02460." As of the time of writing, the stock surged 15.03% to HK$16.68 per share, giving it a total market capitalization of HK$39.162 billion.**

CR Beverage is China's second-largest packaged drinking water company. As one of the most important subsidiaries under CR Beverage, its flagship brand C'estbon achieved retail sales of RMB 39.5 billion in 2023, with annual sales of 14.6 billion bottles and a market share of 32.7%, ranking first in the purified drinking water market.

This listing marks **CR Beverage as the 18th listed company under China Resources Group; it also becomes the second domestic packaged drinking water company listed on the Hong Kong Stock Exchange, following Nongfu Spring.**

**Despite Multiple Changes of Ownership, Its Brilliance Remains Undimmed**

The history of CR Beverage can be traced back to the 1980s. Its predecessor was China Longhuan (Shekou) Co., Ltd. At its inception, the company mainly sold "Cili Juice," a specialty beverage from Guizhou.

By 1990, China Longhuan took the lead in China by launching 600ml*15 packaged "C'estbon" brand distilled water, becoming one of the early enterprises in China to produce and sell packaged drinking water, **ushering in the era of professional bottled drinking water production in China.**

However, good times did not last long. In 1991, China Longhuan encountered operational difficulties. Vanke acquired 51% of China Longhuan's shares, becoming the controlling shareholder. The following year, it made drastic management changes, officially focusing on the drinking water market.

By 1999, due to Vanke's business focus, it began divesting non-core businesses outside real estate, and **"C'estbon" became a "discarded pawn."** Eventually, it was acquired by China Resources Group, which was then aggressively acquiring beer and beverage companies, at a price of RMB 10 million, achieving 100% control.

After several changes of ownership, C'estbon finally leveraged China Resources Group's strong retail network resources to begin its expansion centered on Shenzhen, entering the fast track of development.

Public data shows that in 2007, C'estbon's sales volume exceeded 1 million tons for the first time, launching the **"Westward Advance, Northern Expedition, Eastward Expansion"** national brand development strategy. The following year, this once-underestimated company, with its impressive profitability, entered the first-tier profit sequence of China Resources Group.

In 2015, its turnover exceeded RMB 10 billion, with a five-year compound growth rate of about 40%, and its market share increased to 17.1%, temporarily surpassing Nongfu Spring to rank first nationwide.

As an enterprise under China Resources Group focusing on ready-to-drink soft drinks, in 2021, C'estbon's annual R&D investment was RMB 59 million, a significant increase of 195% compared to 2020. **Over three years, cumulative investment in marketing and promotion exceeded RMB 3 billion, making the "little green bottle" image deeply rooted in people's hearts.**

**In terms of channels, CR Beverage places high importance on the deployment of terminal retail outlets.** According to the prospectus, as of April 30, 2024, CR Beverage cooperated with over 1,000 distributors, covering more than 2 million retail outlets across China, and had over 8,700 frontline sales personnel, making "C'estbon" ubiquitous on streets and alleys.

According to the CIC Consulting report, **from 2012 to 2023, CR Beverage maintained the No. 1 position in China's purified drinking water market for 12 consecutive years. Meanwhile, the company also grew into China's second-largest packaged drinking water enterprise. The "C'estbon" brand purified drinking water ranked second in China's packaged drinking water market in 2023 and first in China's purified drinking water market.**

**The RMB 10 Billion "C'estbon" Listing: The Double-Edged Sword of a Single Product**

As two domestic packaged drinking water companies listed on the Hong Kong Stock Exchange, CR Beverage and Nongfu Spring are inevitably compared.

**Currently, CR Beverage's Hong Kong stock market value is HK$39.162 billion, which is only 1/11 of Nongfu Spring's current market value (HK$338.519 billion).**

In terms of performance, according to the prospectus, from 2021 to 2023, CR Beverage's revenue was RMB 11.340 billion, RMB 12.622 billion, and RMB 13.515 billion, respectively.

In contrast, from 2021 to 2023, Nongfu Spring's revenue was RMB 29.696 billion, RMB 33.239 billion, and RMB 42.667 billion, with year-on-year growth rates of 29.81%, 11.93%, and 28.36%, respectively, significantly higher than CR Beverage.

Additionally, according to relevant data, in 2023, CR Beverage's net profit margin was 9.9%, while Nongfu Spring's was 28.3%. **The net profit margin differs by nearly 30 times.**

There are two main reasons for this gap. **First, product structure.**

Nongfu Spring has a relatively rich product line, including not only regular bottled water but also functional beverages, juices, tea drinks, etc. It has cultivated core brands in different categories, such as Oriental Leaf, Chabi, and Scream, which perform strongly in their respective market segments.

Looking back at CR Beverage, apart from packaged drinking water products, it has also launched tea drinks, juice drinks, carbonated drinks, and other categories, including 13 brands and 59 SKUs, but **none have overshadowed the brilliance of "C'estbon."**

According to the prospectus, in 2021, 2022, 2023, and the four months ended April 30, 2023 and 2024 (during the reporting period), packaged drinking water products accounted for 95.4%, 94.3%, 92.1%, and 89.7% of CR Beverage's total revenue, respectively. Among these, packaged drinking water products with "C'estbon" as the core brand accounted for 99.8%, 99.8%, 99.7%, 99.8%, and 99.2% of the total revenue from packaged drinking water products in the respective periods.

It can be seen that **CR Beverage's business growth is mainly driven by packaged drinking water, and over 90% of its business relies on "C'estbon."**

**Second, different production models.**

Nongfu Spring's production lines are all self-built factories, while C'estbon adopts a **self-built + OEM** model, incurring additional OEM costs. From 2021 to 2023, C'estbon paid RMB 1.992 billion, RMB 2.04 billion, and RMB 2.067 billion to OEM factories, accounting for 17.6%, 16.2%, and 15.3% of revenue, respectively, higher than its profit margin.

Although CR Beverage has maintained the No. 1 position in the purified water field for many years, there is still room for improvement.

**After the IPO, How to Tell a New Story?**

By retail sales, CR Beverage currently holds an 18.4% market share, dominating the purified drinking water segment with a market share of 32.7%, exceeding the total of the second to fifth ranked companies. However, it now faces significant challenges.

In addition to the old rival Nongfu Spring, which entered the purified water track in April 2024 with a "green bottle" image, more and more companies such as Genki Forest, Pangdonglai, and East Buy have successively attempted to grab a share of the market.

In the increasingly homogenized packaged water market, CR Beverage has to directly confront the penetration of other competitors and urgently needs to find new growth points.

Over the past decade or so, although CR Beverage has not made significant progress in diversified layout, we cannot ignore its growth potential. China Resources Group's strong marketing and offline network also add imagination to its diversified expansion.

This Hong Kong listing is both an opportunity and a challenge. As market competition intensifies, we look forward to CR Beverage bringing more surprises to the market and achieving steady growth in valuation.


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