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Korean fried chicken brand eyes global expansion post-IPO

By Oct 22, 2020 (Gmt+09:00)

Kyochon F&B, South Korea’s No.1 fried chicken franchise operator, will increase its number of overseas outlets by more than tenfold by 2025 and diversify into the craft beer, sauce and pet food markets, said company Chairman So Jin-se during an Oct. 22 online conference, ahead of its initial public offering next month.

The company is keen on expanding its global operations with plans to launch over 500 franchises across 25 countries. It is set to tap into the Middle East and Taiwan this year, said Chairman So.

Currently, Kyochon operates around 37 franchises across six countries, including the US, China and Indonesia. The popular Korean fried chicken brand is hoping to secure global partners interested in entering master franchise agreements, which will maximize the tie-ups, Chairman So explained.

The company aims to post 770 billion won ($680 million) in revenue and an operating profit of 100 billion won by 2025, with a substantial amount raised from overseas operations.

Korean fried chicken brand eyes global expansion post-IPO  

During Thursday's conference, the company also shared key growth strategies, which included diversifying its business portfolio. The company plans to shore up its sauce business for outbound shipments, foster online mall operations and produce craft beers.

Riding on the popular chimaek wave, a Korean term for pairing fried chicken and beer, Kyochon plans to make its own craft beer brand that will be sold in its franchises. Also, the company plans to foster its online mall business to sell home-meal-replacement kits to consumers.

Chairman So shared his visions as the company prepares to become the country’s first restaurant franchise to list on Seoul bourse next month.

Kyochon plans to raise up to 71.3 billion won ($61 million) through the initial public offering. The company will float 5.8 million shares and price them between 10,600 won and 12,300 won apiece.

Last year, Kyochon’s operating profit nearly doubled to 39.4 billion won on revenue of 380.1 billion won on a consolidated basis. The company expects to exceed 400 billion won this year as its delivery business posted hefty growth in the first half, following the coronavirus outbreak.

Kyochon’s franchise revenue averaged 618 million won in 2018, the highest among fried chicken chains registered with the Korea Fair Trade Commission. As of August this year, Kyochon operates 1,234 franchises in Korea. 

The company became the industry frontrunner after topping 200 billion won in revenue in 2014. Kyochon has maintained the lead for seven consecutive years.


Write to Ye-jin Jun and Jong-Pil Park at ace@hankyung.com

Danbee Lee edited this article.
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