Sichuan “hot pot” is not everyone’s idea of comfort food. You boil a sliver of meat in a cauldron, dip it into a bath of fire-breathing chilli and then eat. Chilled beer supplies a welcome relief.
Nevertheless, in the current cauldron of emerging markets, Haidilao — a leading Chinese hot pot chain— has become the ultimate comfort stock. It has surged by almost 80 per cent since listing on the Hong Kong market in September last year.
But what defines Haidilao also describes, in inverse, a deepening malaise in emerging market equities. The hot pot chain is unlikely to be a victim if globalisation shifts into reverse. Its supply chain of chilli, garlic, sesame sauce and lamb will not be disrupted by the tech war between the US and China. The company may also evade being swept up in the tensions engulfing Hong Kong.