I read the F-1 Form in the weekend. While I am not a financial analyst, I have the following comments.
1) Home Inns probablly has the best management or directors. Three of its directors, Neil Shen, James Liang, and Qi Ji are founders of Ctrip and have extensive experience on Investment, travel and IT industry.
2) Business outlook: the economy motel in China is booming, because of the increasing business and leisure travellers. There are 2 strong competititors: Jin Jiang Star and Motel 168. I stayed in Jin Jiang star and they are good too. I heard from Motel 168 from Taxi driver (later I found Wang Jianshuo mentioned it in his blog.)
3) Consumer experience: fair. It’s clean. But the rooms in Shanghai Pu Xi areas are ususally old and its condition are not great (sound insulation, bugs, etc.) The staffs are usually friendly (above average in China), but can not compared with the “customer first” attitude in the US.
4) Risks: The directors and management award about 650,000 shares of stock options on Oct 2 (before this public offering), while this does not dilute the stock too bad, it’s something they do for their own benefit. Of course the biggest risk is the China economy slow down. I am not an economist, but I know an economy can not run at this speed (10% growth annually) forever.
It is reported will be priced between $10 to $14. The growth from 2006 over 2005 is exponential (the 2006 first half already exceeded 2005 revenue and profit). So it will do good for a while. Don’t expect it be like Baidu (BIDU) though.