A pedestrian walks past a Goubuli restaurant in Tianjin. The company is planning to issue 30 million shares on the National Equities Exchange and Quotations. [Photo/China Daily]

Tianjin's 150-year-old food brand Goubuli is seeking a more vibrant future in the capital market to finance its expansion plans.

According to the announcement released by Tianjin Goubuli Food Co Ltd, the company is planning to issue 30 million shares on the National Equities Exchange and Quotations, or better known as the New Third Board.

The eatery company is known for its uniquely flavored baozi, or steamed buns and considered a brand ambassador of the traditional North China cuisine. Tianjin Goubuli Food posted revenue of 40.82 million yuan ($6.38 million) in the first five months of this year, while the net profit during the same period was 3.47 million yuan. However, its revenue declined to 74.07 million yuan last year from 92.91 million yuan in 2013.

The company in its regulatory filing warned of gross profit risks due to lower sales of frozen flour-made food products. Besides, the majority - about 70 percent - of its sales and operating profit comes from Tianjin. Despite the company's further expansion into other regions, little progress has been made so far due to its limited capacity.

Tianjin Goubuli Food's mother company Tianjin Goubuli Group's IPO application was rejected by the China Securities Regulatory Commission in July last year. Similarly, Beijing Shunfeng Catering and Entertainment Co Ltd and Jingya Group from Shandong province have also seen their IPO applications stall. At present, Guangzhou Restaurant Group Co Ltd is the only food or catering company that is planning an IPO.

Yao Xuezheng, honorary vice-president of the Guangdong Restaurant Association, said that the unstable profitability, less transparent financial information and management irregularities are the three main reasons why IPO applications of catering companies are being rejected by the CSRC.

As a result, the New Third Board has become the favorite option for such companies to raise funds. Huatian Industry Holding Group Co Ltd plans to list its well-known Qingfeng steamed stuffed bun branch on the New Third Board.

According to the official statistics, 3,348 companies have been listed on it by Aug 28, with their total equities reaching 172.9 billion shares. Wang Lei, general manager of the OTC department of Qilu Securities Co, said that the New Third Board will be more differentiated in the future with better regulations.