Core Insights - Budweiser APAC reported Q2 2025 revenue of $1.675 billion, with an organic year-on-year decline of 3.9% [1] - Normalized EBITDA for Q2 2025 was $498 million, reflecting an organic year-on-year decrease of 4.5% [1] - Net profit attributable to the parent company was $175 million, down 31.1% year-on-year [1] Revenue and Profitability - Q2 2025 sales volume reached 23.887 million hectoliters, showing an organic year-on-year decline of 6.2% [1] - Revenue per hectoliter increased by 2.4% year-on-year in Q2 2025 [1] - Gross margin for Q2 2025 was 51.8%, with an organic year-on-year increase of 0.71 percentage points [1] - Normalized EBITDA margin was 29.7%, reflecting an organic year-on-year decrease of 0.21 percentage points [1] Regional Performance - In the Western Asia-Pacific region, Q2 2025 revenue and normalized EBITDA saw organic year-on-year declines of 2.7% and increases of 1.4%, respectively, with sales volume down 5.6% [2] - In the Eastern Asia-Pacific region, Q2 2025 revenue and normalized EBITDA experienced organic year-on-year declines of 8.4% and 26.5%, respectively, with sales volume down 10.4% [2] - In South Korea, Q2 2025 sales volume saw a high single-digit decline, primarily due to early shipments, while revenue management measures led to low single-digit growth in revenue per hectoliter [2] China Market Insights - In China, Q2 2025 revenue and normalized EBITDA experienced organic year-on-year declines of 6.4% and 4.0%, respectively, with sales volume down 7.4% [3] - Despite the decline in sales volume, revenue per hectoliter increased by 1.1% year-on-year due to product mix optimization [3] - The company has focused on non-immediate consumption channels, which have shown year-on-year growth in both sales volume and revenue [3] Inventory Management and Future Outlook - The company has been actively managing inventory, achieving a reduction in inventory levels compared to the previous year and significantly below the industry average [3] - The weak performance in the immediate consumption channel is expected to continue into the second half of the year, with ongoing inventory control measures [3] - Profit forecasts for net profit attributable to the parent company have been revised down for 2025-2027 to $690 million, $737 million, and $782 million, reflecting decreases of 8%, 8%, and 7%, respectively [3]

Investment Rating - The report maintains a "Neutral" rating for Budweiser Brewing Co APAC with a target price of HK$7.90, while the current price is HK$8.09 [2][6]. Core Insights - The company is experiencing marginal improvements, but the recovery process is slower than expected, with total sales volume in 25H1 declining by 6.1% year-on-year and revenue decreasing by 5.6% year-on-year [3][10]. - The Chinese market continues to face challenges, with sales volume and revenue down by 8.2% and 9.5% respectively in 25H1, although there are signs of marginal improvement in Q2 [4][11]. - The South Korean market is undergoing structural adjustments, while the Indian market shows resilience with double-digit revenue growth in Q2 [5][12]. Financial Performance Summary - For 2024A, the company expects revenue of US$6.246 billion, with a projected decline of 8.9% year-on-year. The net profit is estimated at US$726 million, reflecting a decrease of 14.8% [2][9]. - The gross profit margin is projected to be 50.4% for 2024A, with a gradual increase to 51.1% by 2027E [2][9]. - The earnings per share (EPS) for 2025-2027 are estimated to be USD 0.05, USD 0.05, and USD 0.06 respectively [6][13]. Market Analysis - In the Chinese market, the on-premise channel remains weak, and the transformation is still in its early stages, with a focus on premium products in non-on-premise channels [4][11]. - The company has been actively managing inventory, achieving better-than-historical inventory levels by the end of Q2 2025, which supports future sales growth [4][11]. - In South Korea, the company implemented a price increase of 2.9% for core brands, but the market response was neutral, and overall performance remains under pressure [5][12]. Investment Recommendations - The report suggests that if the company can overcome challenges related to channel transformation and expense control, it may reverse the decline in market share in China, laying the groundwork for medium- to long-term recovery [6][13].

Investment Rating - The report assigns an "Outperform" rating to multiple companies in the consumer staples sector, including Guizhou Moutai, Wuliangye, Luzhou Laojiao, and others [1]. Core Insights - The report highlights that most baijiu wholesale prices have stabilized, with specific price changes noted for various brands. For instance, the price of Feitian Moutai (case) is 1915 yuan, down by 35 yuan from the previous month, and down 665 yuan year-on-year [3][9]. - Discounts on liquid milk and beer have decreased compared to previous months, indicating a shift in pricing strategies within the consumer goods market [5][22]. Summary by Sections Baijiu Pricing - Guizhou Moutai's prices for different products have shown a decline, with Feitian Moutai (case) at 1915 yuan, down 35 yuan month-on-month and 665 yuan year-on-year [3][9]. - Wuliangye's eighth-generation price is 930 yuan, stable compared to last month and unchanged year-on-year [4][9]. - Luzhou Laojiao's Guojiao 1573 remains at 860 yuan, unchanged from last month and down 40 yuan year-on-year [4][9]. Consumer Goods Discounts - The average discount rate for liquid milk has decreased to 79.1% from 73.8% at the end of June, while the median discount rate increased to 80.3% [5][22]. - Beer discounts have also seen a slight increase, with average and median rates at 83.6% and 87.0%, respectively, compared to 81.1% and 84.6% in late June [5][22]. - Discounts for infant formula and instant foods have remained stable, with average rates at 93.0% and 94.3%, respectively [7][22].

Core Viewpoint - Budweiser APAC reported a decline in revenue and net profit for the first half of 2025, indicating challenges in the beer market, particularly in China, while showing signs of marginal improvement in the second quarter [1][2]. Financial Performance - For the first half of 2025, Budweiser APAC's revenue was $3.136 billion, a decrease of 5.6% year-on-year; net profit was $409 million, down 24.4%; total sales volume was 4.363 billion liters, a decline of 6.1% [1]. - The second quarter showed a smaller revenue decline of 3.9% compared to a 7.5% decline in the first quarter, indicating a trend of marginal improvement [1]. - Average revenue per hectoliter increased by 0.5% year-on-year for the first half, with a 2.4% increase in the second quarter, contrasting with a 1.5% decline in the first quarter [1]. Regional Performance - In China, sales volume decreased by 8.2% and revenue by 9.5% in the first half, with a 7.4% decline in sales volume and a 6.4% decline in revenue in the second quarter [2]. - The Indian market experienced double-digit growth in revenue and sales volume for high-end products, continuing to drive overall growth [2]. - In South Korea, sales volume showed a high single-digit decline, while revenue also decreased significantly due to reduced sales volume, although average revenue per hectoliter saw low single-digit growth [2]. Inventory Management - Inventory adjustment was a key operational focus for Budweiser APAC in the first half, with proactive measures taken to align inventory levels with market conditions [3]. - The company reported lower inventory levels and days compared to the previous year, indicating effective inventory management [3]. Strategic Focus - The new CEO and sales leadership are undergoing structural and strategic adjustments, facing challenges in channel transformation, management efficiency, and external risks [3]. - The company plans to focus on controllable areas, increasing investment in brands like Budweiser and Harbin, while expanding non-immediate consumption channels and enhancing execution [3]. - Analysts suggest that the company may see marginal recovery in the Chinese market in the second half, but emphasize the need for time to build brand influence and establish non-immediate consumption channels [3].

Group 1: Budweiser APAC - Budweiser APAC reported a 5.6% decrease in revenue to $3.136 billion for the first half of 2025, with normalized EBITDA down 8% to $983 million [1] - Sales volume declined by 6.1% to 4.363 billion liters, with a 7.4% drop in sales volume in the Chinese market during Q2 2025 [1] - The company focused on non-immediate consumption channels to drive premiumization, achieving growth in both sales and revenue from these channels [1] Group 2: Unilever - Unilever's revenue for the first half of 2025 was €30.1 billion, a 3.2% year-on-year decline, with ice cream business revenue growing by 0.2% [2] - The company plans to spin off its ice cream business by mid-November 2025, with operational separation already completed [2] Group 3: Daodaoquan - Daodaoquan reported a 563.15% increase in net profit to ¥181 million for the first half of 2025, with total revenue reaching ¥2.792 billion, a 1.16% increase [3] - Revenue from packaged oil increased by 20.53% to ¥1.751 billion [3] Group 4: Food Safety Issues - Taoli Bread issued an apology after a batch of its sliced bread failed quality checks, with 498 bags produced and 21 sold online [4] - The company has initiated a recall and implemented measures to enhance quality control and monitoring [4] Group 5: Regulatory Actions - The State Administration for Market Regulation reported 12,000 instances of non-compliance related to food additives in the first half of the year, with 4,727 companies penalized [5][6] - The agency emphasized the importance of strict monitoring and compliance regarding food additives to ensure food safety [5][6] Group 6: Luckin Coffee - Luckin Coffee's Q2 2025 net revenue reached ¥12.359 billion, a 47.1% year-on-year increase, with a gross merchandise volume of ¥14.179 billion [8] - The company opened 2,109 new stores, bringing the total to 26,206 globally, with significant growth in self-operated stores [8] Group 7: Starbucks China - Starbucks China reported an 8% revenue increase to $790 million for Q3 2025, marking three consecutive quarters of growth [9] - The company is evaluating partnerships with over 20 interested institutions to retain a significant equity stake in its Chinese operations [9] Group 8: L'Oréal - L'Oréal's sales for the first half of 2025 increased by 3.2% to €22.47 billion, with North Asia's skincare division maintaining double-digit growth [10][11] - The company noted strong performance from high-end brands, offsetting weaknesses in the skincare category [11] Group 9: Yonghui Supermarket - Yonghui Supermarket announced plans to raise up to ¥3.992 billion through a private placement of A-shares, with funds allocated for store upgrades and logistics improvements [13]

Group 1 - CITIC Securities maintains a "Buy" rating for Kuaishou (01024.HK), highlighting the company's growth in platform ecology and commercialization, with future profit margins expected to optimize [1] - Huachuang Securities maintains a "Strong Buy" rating for Li Auto (02015.HK), noting the company's strong competitiveness in the vehicle market and rapid AI transformation, with revised sales and revenue forecasts for 2025-2027 [1] - CMB International maintains a "Buy" rating for Budweiser APAC (01876.HK), indicating a recovery in sales and pricing in the Chinese market, while adjusting revenue and profit forecasts for 2025-2027 [1] Group 2 - JPMorgan maintains an "Overweight" rating for UBTECH (09880.HK), projecting a compound annual growth rate of 260% for its humanoid robot business from 2025 to 2027, with significant contributions to revenue [2] - Tianfeng Securities initiates a "Buy" rating for Hong Kong and China Gas (01083.HK), emphasizing its leading position in smart energy and strong profit forecasts for 2025-2027 [2] Group 3 - Guohai Securities maintains an "Outperform" rating for Laopu Gold (06181.HK), forecasting significant growth in sales and net profit for the first half of 2025, driven by brand influence and product optimization [3] Group 4 - CICC maintains an "Outperform" rating for MGM China (02282.HK), reporting strong performance in Q2 2025, with expectations for continued market share growth and product updates [4] - CICC maintains a "Hold" rating for Prada (01913.HK), anticipating above-industry revenue growth despite uncertainties related to the Versace integration [4] Group 5 - CITIC Securities maintains a "Buy" rating for New Oriental (09901.HK), reporting record revenue and profit in Q4 FY25, with a projected growth rate of 5%-10% for FY2026 [5] - CICC maintains an "Outperform" rating for Standard Chartered (02888.HK), noting better-than-expected Q2 2025 performance driven by non-interest income growth [5]

Investment Rating - The report maintains a "Buy" rating for Budweiser APAC (1876.HK) [5] Core Views - Budweiser APAC's Q2 2025 revenue was $1.675 billion, with a year-on-year decline of 3.9% [1] - Normalized EBITDA for Q2 2025 was $498 million, down 4.5% year-on-year, while net profit attributable to shareholders was $175 million, reflecting a 31.1% decrease [1] - The company is focusing on optimizing product structure, which has led to an increase in ton price and gross margin despite pressure on sales volume [2][3] Summary by Sections Sales Performance - Q2 2025 sales volume was 23.887 million kiloliters, down 6.2% year-on-year, while revenue per hectoliter increased by 2.4% [2] - Gross margin for Q2 2025 was 51.8%, up 0.71 percentage points year-on-year [2] - The company experienced a decline in sales across both eastern and western regions of Asia-Pacific, with notable performance in high-end products in India [2] Regional Analysis - In the western Asia-Pacific region, revenue and normalized EBITDA saw a year-on-year decline of 2.7% and an increase of 1.4%, respectively, with sales volume down 5.6% [2] - The eastern Asia-Pacific region faced a more significant decline, with revenue and normalized EBITDA down 8.4% and 26.5%, respectively, and sales volume down 10.4% [2] Inventory Management - The company has been actively managing inventory, with Q2 2025 inventory levels lower than the previous year and significantly below the industry average [3] - The focus on non-immediate consumption channels has contributed to growth in high-end product sales [3] Financial Forecasts - The net profit forecasts for 2025-2027 have been revised down to $690 million, $737 million, and $782 million, respectively, reflecting a decrease of 8% for 2025 and 2026 [3] - The current stock price corresponds to a PE ratio of 20x for 2025, 19x for 2026, and 18x for 2027, indicating a favorable outlook in the high-end market segment [3]

Core Viewpoint - The report from Credit Lyonnais indicates that Budweiser APAC (01876) has shown continuous improvement in its Chinese operations for the second quarter, but anticipates challenges in the third quarter due to new restrictions on alcohol consumption in official settings, ongoing inventory destocking, and a high revenue base from the previous year [1] Summary by Relevant Sections - **Business Performance** - Budweiser APAC's Chinese business has shown improvement in the second quarter [1] - The company is expected to face challenges in the third quarter due to new regulations affecting restaurant channels and inventory issues [1] - **Target Price and Ratings** - Credit Lyonnais has lowered the target price for Budweiser APAC from HKD 10.4 to HKD 9.3 [1] - The rating remains "Outperform," supported by a dividend yield exceeding 5%, which provides a buffer against potential stock price declines [1] - **Earnings Forecast** - The earnings forecast has been revised downwards, with projected revenue and EBITDA for 2025 expected to decline by 6% and 9% respectively [1]

Core Viewpoint - The report from Credit Lyonnais indicates that Budweiser APAC (01876) has shown continuous improvement in its Chinese operations for the second quarter, but anticipates challenges in the third quarter due to new restrictions on alcohol sales in official venues, ongoing inventory destocking, and a high revenue base from the previous year [1] Summary by Category Business Performance - Budweiser APAC's Chinese business has shown improvement in the second quarter [1] - The company is expected to face challenges in the third quarter due to new regulations affecting restaurant channels and inventory issues [1] Financial Projections - Credit Lyonnais has lowered the target price for Budweiser APAC from HKD 10.4 to HKD 9.3 while maintaining an "outperform" rating, which is supported by a dividend yield exceeding 5% [1] - The earnings forecast has been adjusted, with projected revenue and EBITDA declines of 6% and 9% respectively for 2025 [1]

Group 1: Budweiser APAC Performance - Budweiser APAC reported a 24.4% decline in net profit to $409 million in the first half of 2025, facing challenges with both total sales and revenue decreasing [1] - In the Chinese market, Budweiser APAC experienced an 8.2% drop in sales and a 9.5% decrease in revenue, with revenue per hectoliter falling by 1.4% [1] - In contrast, Heineken's high-end products in China saw a sales growth exceeding 30%, indicating a strong performance in the same market [1] Group 2: Langjiu's Product Launch - Langjiu announced that the 2025 version of Langpai Lang will start accepting sales orders from August 11, with deliveries beginning on August 25 [2] - This move reflects Langjiu's proactive strategy to adapt to market changes towards younger and lower-alcohol products, reinforcing its market position through differentiated competition [2] Group 3: Restructuring in Renhuai's Liquor Industry - Renhuai city has successfully pushed for the merger and restructuring of 681 liquor enterprises, significantly reducing the number of production entities from 1,925 to 868 [3] - The comprehensive governance plan has led to a notable increase in industry concentration, optimizing the competitive landscape and potentially allowing leading companies to expand their market share [3] - The shift towards a more concentrated and high-quality development model in the liquor industry is expected to benefit long-term sustainability and may lead to a revaluation opportunity for key players [3]