Helen's Chinese trademark invalidated in final ruling: the business pressure behind a market cap drop of more than 90%

According to Blue Whale News, the Chinese bar brand Helen's has recently lost its Chinese name. The court's final ruling found the three Chinese trademarks 'Helen's', 'Helen's Tavern' and 'Helen's Bigger Dapaidang' invalid.

The announcement said the dispute has no material impact on the group's overall business, daily operations or financial condition, and the group can continue to use its undisputed trademarks in day-to-day business. Even so, the capital market is more sensitive.

From an English trademark foundation to invalid Chinese trademarks

Helen's was founded in 2009 and first opened in Beijing's Wudaokou area, next to universities. Founder Xu Bingzhong once said that in the early days of the business, the company mainly targeted the foreigner market, including overseas students.

Reports say Helen's first used English trademarks such as 'Helen's' and filed a batch of related English trademarks in 2013, while its core Chinese trademarks were not registered until 2018, laying the groundwork for the later trademark crisis.

The dispute mainly arose between Chengdu Helen Colorful Hotel Co., Ltd. and Helen's. The other party successfully registered two 'Helen' trademarks in 2016, both in Class 43, covering restaurant and bar services. It then filed invalidation requests with the China National Intellectual Property Administration on May 23, 2023 for the 'Helen's' trademark, and on August 7, 2024 for the 'Helen's Tavern' and 'Helen's Bigger Dapaidang' trademarks, arguing that the disputed marks were similar to its two cited 'Helen' marks for similar services and could easily confuse consumers about the source of services.

On the evening of June 25, Helen's announced that the above three Chinese trademarks had been finally ruled invalid by the court. The announcement said the current assessment shows the dispute has no material impact on the group's finances and operations, but the Chinese wording is still being used.

Blue Whale News reporters found that, so far, Helen's offline stores and online promotion are still using its Chinese name and related wording. After the news was released, the stock opened lower on June 26 and at one point fell more than 6% intraday; by the close, Helen's share price fell to HK$1.58. Its market cap once reached HK$30 billion in the year of listing, but has now dropped to HK$2 billion, a decline of more than 90%.

From 'young people's first bar' to pressure from store expansion

Helen's early stores were located around university districts, and the main customer base consisted of foreigners and international students. Later, founder Xu Bingzhong adjusted the positioning and described Helen's as 'an offline space for free social interaction among young people,' using 'extreme value for money' to win the market: bottled beer sold for less than 10 yuan, and cocktails were slightly more expensive, in the low 20s.

The 'young people + value for money' model was copied widely. Data show that by the end of 2021, Helen's had 782 stores; that same year it listed in Hong Kong.

Helen's 2021 prospectus disclosed that 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 respectively. Although drink prices were low, that did not mean the business was unprofitable.

The prospectus showed that self-owned beverages contributed more than 60% of Helen's beverage revenue, with gross margins above 70%; thanks to direct factory sourcing and scale economics, the purchase prices of third-party branded drinks were also relatively favorable.

One of its advantages was scale expansion. But as opening costs surged and the pandemic took its toll, Helen's posted a net loss of 230 million yuan in 2021; the following year, the net loss widened to 1.601 billion yuan.

After cumulative losses of more than 1.8 billion yuan, Helen's began closing stores to save itself. Financial reports show that by the end of 2023, Helen's had 479 bars, 288 fewer than a year earlier; compared with the peak of more than 850 stores, that was a drop of more than 40%.

At the same time, Helen's launched a strategic shift from fully self-operated stores to an open franchise model, introducing its 'Hi Beer Partner' plan. When the plan started, the minimum investment threshold was 600,000 yuan; by 2024, the threshold for new store formats had fallen to around 400,000 yuan.

A sea of bistros and lower unit sales: weakening appeal of low prices

The turnaround measures brought some improvement. According to the 2025 financial report, Helen's full-year revenue was 540 million yuan, down 28.3% year on year; net profit attributable to shareholders was 33.954 million yuan, successfully returning to profit. The share of self-owned beverage income and gross profit rate both improved year on year, store-level gross margin rose to 73.77%, and overall operating conditions improved from the previous year.

But the article points out that Helen's still faces the reality of falling average daily sales per store. In 2025, same-store average daily sales at self-operated and franchised partnership stores were 8,500 yuan, down more than 18% year on year; the overall average daily sales per partner store were only 4,100 yuan, with average daily sales falling across all store types.

In a catering sector where a single store can easily generate more than 10,000 yuan a day, Helen's main franchise model earns relatively little. Another pressure point is its regional structure: nearly 70% of its stores are in third-tier cities and below, putting profitability under pressure.

Meanwhile, young people now have more places to drink. Narrow Door Restaurant Eye shows that as many as 38,000 bars opened in the past year. From home bars, craft-beer bars and livehouse-style bars to various bistros, the consumption scene has become more diverse.

Among them, the food-and-drink bistro has risen strongly in recent years. Taking Huanshi as an example, the article notes that its parent company Jiwu Thinking submitted a prospectus to the Hong Kong stock exchange in January this year; Huanshi has more than 100 stores in China and its revenue exceeded 1 billion yuan in 2024.

Compared with Helen's market entry strategy of low prices and scale, Huanshi has taken a more atmosphere-driven, higher-ticket path: per capita spending exceeds 100 yuan. The article mentions that on social media, one image of Huanshi is 'beautiful food.' Its prospectus disclosed that its same-store average daily sales were 29,880 yuan in the first nine months of 2025.

Huanshi extends operating hours to more than 18 hours by offering brunch, afternoon tea, dinner and late-night drinks, improving store utilization and operating efficiency. The article's data show that in the nine months ended September 30, 2025, drinks contributed about 45% of revenue, 85% of which came from alcoholic beverages; during the same period, Huanshi's overall gross margin held steady at 68.7%, above the industry average.

However, the article also notes that Huanshi faces pressure from store costs and reputation. Consumer complaints about taste and quality may hurt the brand.

Analyst Zhu Danpeng believes that, just like the coffee sector, low-, mid- and high-end brands each have their own market. For bars, brand effect, scale effect, fan effect, supply-chain completeness and single-store operating ability are the 'hard-core factors' that affect future development. Since each store is in a different location, strategies should be differentiated.

For Helen's, figuring out how to run each store well may be its biggest challenge right now.