Core Viewpoint - The company is positioned as a multinational health products firm focusing on rapidly developing emerging markets in Africa, Latin America, and Central Asia, specializing in the development, manufacturing, and sales of baby diapers, baby pull-ups, sanitary napkins, and wet wipes [1] Group 1: Market Position and Product Offerings - The company ranks first in Africa's baby diaper and sanitary napkin markets by volume, with market shares of 20.3% and 15.6% respectively for 2024 [1] - By revenue, the company holds the second position in Africa's baby diaper and sanitary napkin markets, with market shares of 17.2% and 11.9% respectively for 2024 [1] - The company focuses on creating differentiated products to meet diverse market demands, continuously iterating and upgrading its offerings [1] Group 2: Revenue Contribution and Growth - In the first four months of 2025, the revenue contributions from baby diapers, sanitary napkins, baby pull-ups, and wet wipes were $1.2 million, $0.3 million, $0.1 million, and $0.1 million respectively, accounting for 71.8%, 18.6%, 5.8%, and 3.9% of total revenue [2] - The compound annual growth rates (CAGR) for baby diapers, sanitary napkins, baby pull-ups, and wet wipes from 2022 to 2024 are projected at 16.8%, 34.1%, 8.6%, and 28.5% respectively [2] Group 3: Supply Chain and Production - The company has established a robust global supply chain with localized production to reduce costs, starting local production in Ghana in 2018 [3] - As of April 30, 2025, the company operates eight production facilities across eight African countries, with a total of 51 production lines for baby diapers, baby pull-ups, sanitary napkins, and wet wipes [3] - A new production facility in El Salvador is set to begin operations in August 2025, featuring a production line for baby diapers [3] Group 4: Distribution and Market Penetration - The company has built a wide distribution network, establishing 18 sales branches in 12 countries and a network of over 2,800 wholesalers, distributors, supermarkets, and other retailers [3] - The sales network covers over 80% of the local population in key operating countries, which is crucial for success in the baby and women's hygiene products industry in emerging markets [3] Group 5: Financial Forecast - Projected revenues for the company from 2025 to 2027 are $540 million, $640 million, and $740 million, representing year-on-year growth rates of 19%, 18%, and 16% respectively [4] - Expected net profits for the same period are $110 million, $140 million, and $170 million, with growth rates of 15%, 27%, and 18% respectively [4] - The company is rated as a premium leader in the hygiene products sector, with a favorable outlook for continued growth and expansion in products and markets [4]

Core Viewpoint - The Hang Seng Index Company announced the quarterly review results for the Hang Seng Index series, including the inclusion of LeShuShi (02698) in the Hang Seng Composite Index, effective March 9, 2026 [1] Company Overview - LeShuShi is a multinational hygiene products company focused on rapidly developing emerging markets in Africa, Latin America, and Central Asia, primarily engaged in the development, manufacturing, and sales of baby diapers, baby pull-ups, sanitary napkins, and wet wipes [1] - The company operates under several brands, including Softcare, Veesper, Maya, Cuettie, and Clincleer, with product sales covering over 30 countries in West Africa, East Africa, and Central Africa [1] - A significant portion of the company's revenue during the historical period came from sales to African customers [1] Market Implications - The inclusion of LeShuShi in the Hang Seng Composite Index may lead to its potential addition to the Hong Kong Stock Connect, as it meets various criteria such as market capitalization, liquidity, and listing duration [1]

Group 1 - The Hang Seng Index Company announced the quarterly review results for the Hang Seng Index series as of December 31, 2025, with LeShuShi (02698) being included in the Hang Seng Composite Index [1] - The changes will take effect after the market closes on March 6, 2026, and will be effective from March 9, 2026, with corresponding adjustments to the eligible stocks for the Hong Kong Stock Connect [1] - According to a report by CICC, LeShuShi is likely to be included in the Hong Kong Stock Connect due to meeting various criteria, including market capitalization, liquidity, and listing time [1] Group 2 - LeShuShi is a multinational hygiene products company focused on rapidly developing emerging markets in Africa, Latin America, and Central Asia, primarily engaged in the development, manufacturing, and sales of baby diapers, baby pull-ups, sanitary napkins, and wet wipes [1] - The company operates under brands such as Softcare, Veesper, Maya, Cuettie, and Clincleer, with product sales covering over 30 countries in West Africa, East Africa, and Central Africa [1] - During the historical performance period, the majority of the company's revenue was derived from sales to African customers [1]

Investment Rating - The report assigns a "Buy" rating for the company, marking its first coverage in the market [5][8]. Core Insights - The company is positioned as a leading player in the African hygiene products market, with a strong local competitive advantage [5][10]. - The company focuses on developing, manufacturing, and selling baby diapers, baby pull-ups, sanitary napkins, and wet wipes, catering to diverse market needs [7][14]. - The report highlights the company's robust growth trajectory, with projected revenue and net profit increases over the next few years [8][47]. Financial Performance - As of February 12, 2026, the closing price is HKD 31.26, with a market capitalization of HKD 19,366.09 million [3]. - Revenue projections for 2025-2027 are USD 540.43 million, USD 635.51 million, and USD 738.25 million, respectively, with year-on-year growth rates of 19%, 18%, and 16% [8][47]. - The net profit estimates for the same period are USD 109.83 million, USD 139.94 million, and USD 165.50 million, with growth rates of 15%, 27%, and 18% [8][47]. Market Position - The company holds the top market share in the African baby diaper and sanitary napkin markets, with respective shares of 20.3% and 15.6% based on 2024 sales volume [7][14]. - The company has established a comprehensive distribution network across 12 countries, reaching over 80% of the local population in key markets [42]. Product Strategy - The company employs a multi-brand strategy to cater to various consumer segments, with five major brands targeting different market tiers [26][32]. - The product lines include a total of 341 SKUs, with a focus on continuous product iteration to meet diverse consumer needs [26][32]. Supply Chain and Production - The company has built a robust global supply chain with localized production facilities in eight African countries, enhancing cost efficiency [36][42]. - As of April 30, 2025, the company operates 51 production lines across its facilities, with a total designed capacity for various hygiene products [36][42]. Growth Potential - The report anticipates significant growth in the baby diaper and sanitary napkin segments, driven by increasing birth rates and rising market penetration in Africa [9][47]. - The company is expected to maintain a competitive edge due to its established market presence and strong distribution capabilities [10][50].

Investment Rating - The report gives a "Buy" rating for the company, marking its first coverage in the market [4][6]. Core Insights - The company is a leader in the African hygiene products industry, with a projected revenue of $450 million in 2024 and a three-year CAGR of 19%. Net profit is expected to reach $95 million, with a CAGR of 130% [1][4]. - The African hygiene products market is still in its early industrialization stage, presenting significant growth potential. The market for baby diapers, pull-ups, and sanitary pads is estimated to be $3.8 billion in 2024, with a projected growth rate of approximately 8% over the next five years [2][40]. - The company has established competitive barriers through a multi-brand strategy, a robust local supply chain, and a mature sales network, covering over 30 African countries and reaching more than 80% of the local population [3][62]. Summary by Sections Company Overview - The company, established in 2009, has become a leading brand in Africa's hygiene products sector, launching several brands including Softcare, Maya, Veesper, Cuettie, and Clincleer [1][16]. Market Potential - Africa's GDP is expected to grow at around 4%, with a high birth rate of approximately 4% and a low penetration rate of hygiene products (20% for diapers compared to 80% in developed markets) [2][40]. - The market for disposable hygiene products in Africa is projected to grow significantly, with the baby diaper market expected to reach $2.59 billion by 2024, growing at a CAGR of 6.2% [49]. Competitive Advantages - The company has a diverse brand portfolio that covers various market segments, with Softcare being the leading brand in terms of sales volume [3][62]. - The company has developed a comprehensive sales network and local manufacturing capabilities, with eight factories across Africa, making it the largest local manufacturer in the hygiene products sector [3][62]. Financial Analysis - The company’s revenue is projected to grow from $411 million in 2023 to $454 million in 2024, with a net profit increase from $64.68 million to $95.11 million during the same period [5][24]. - The expected earnings per share for 2024 is $0.19, with a price-to-earnings ratio of 2.39 [5][4]. Investment Forecast - Revenue projections for 2025-2027 are estimated at $529 million, $610 million, and $703 million respectively, with corresponding net profits of $115 million, $133 million, and $156 million [4][5].

Investment Rating - The report assigns a "Buy" rating to the company with a target price of 38 HKD [3][6]. Core Insights - The company, Leshu Shi (2698.HK), is a leading multinational hygiene products company focused on emerging markets such as Africa, Latin America, and Central Asia, specializing in baby diapers, pull-ups, sanitary napkins, and wet wipes [1][2]. - Revenue for the first four months of 2024 and 2025 was 320 million and 160 million USD, respectively, showing year-on-year growth of 10.5% and 15.5%, while net profit was 95 million and 31 million USD, reflecting growth of 47.0% and 8.4% [1]. - The company is expected to see net profits of 106 million, 129 million, and 147 million USD for 2025, 2026, and 2027, respectively, with corresponding EPS of 0.18, 0.21, and 0.24 USD [1][3]. Company Overview - Leshu Shi has established a broad sales network across over 30 countries in Africa, Latin America, and Central Asia, with 18 sales branches and over 2,800 wholesalers, distributors, supermarkets, and other retailers [2][17]. - The company has a strong local production presence in Africa with 8 factories, making it the largest manufacturer of hygiene products in the region [2][20]. Business Growth Factors - Future growth is anticipated from external factors such as demographic growth in emerging markets, ongoing consumption upgrades, and increased penetration of hygiene products [3][12]. - Internal growth factors include localized production creating a competitive moat, extensive sales channel coverage, continuous product category expansion, and replicating successful market experiences in other emerging markets [3][12]. Financial and Valuation Summary - The company’s projected revenues for 2025, 2026, and 2027 are 541 million, 627 million, and 711 million USD, with growth rates of 19.1%, 15.9%, and 13.4% respectively [4]. - The net profit margins are expected to remain stable, with net profit margins of 19.6%, 20.5%, and 20.7% for the years 2025, 2026, and 2027 [4]. - The company is valued at a 23x PE ratio for 2026, corresponding to a stock price of 38 HKD [3][4]. Market Characteristics - Emerging markets, particularly Africa, are characterized by strong economic growth, a young population driving consumption upgrades, and high import demand due to lower local industrialization [46][47]. - The African market is expected to see significant growth in the hygiene products sector, with the baby diaper market projected to grow from 2.037 billion USD in 2020 to 2.590 billion USD by 2024, reflecting a CAGR of approximately 6.2% [49][53].

Core Viewpoint - The report from Open Source Securities indicates that Leshush (02698) is expected to achieve long-term stable growth, with projected net profits for 2025-2027 at $112 million, $132 million, and $154 million, respectively, corresponding to EPS of $0.18, $0.21, and $0.25, and a current PE ratio of 22.3, 18.8, and 16.1 times [1] Group 1: Market Position and Growth Potential - Leshush is a leading player in the African hygiene products industry, specializing in the production and sales of baby diapers and sanitary pads, holding the top market share in both categories [1] - The African market benefits from a demographic dividend and low penetration rates for diapers and sanitary pads, indicating significant growth potential for the industry [1] - The company's strong localization capabilities are underestimated by the market, and it is expected to continue expanding its channels and product categories in the African market while replicating its operational capabilities in other emerging regions [1] Group 2: Product Strategy - In the baby care sector, Leshush has established a multi-brand strategy with four major brands and differentiated product lines, aiming for 263 SKUs by April 2025 [2] - In the female care segment, the company has developed three major brands with 44 SKUs to meet diverse local needs, maintaining the leading market share in Africa for both baby diapers and sanitary pads with a growth rate surpassing competitors [2] Group 3: Production and Distribution Capabilities - The company has established local production capacity across eight African countries with eight factories and 51 production lines, making it the most widely distributed hygiene products manufacturer in Africa [3] - The production capacity for baby diapers and sanitary pads is expected to be the highest in Africa by 2024, with plans for expansion to solidify supply capabilities [3] - Leshush has built a comprehensive sales network covering over 30 countries, with 18 branches and more than 2,800 wholesalers and distributors, reaching over 80% of the local population, demonstrating a strong understanding of the African market and distribution channels [3]

Group 1 - Everbright Securities maintains a "Buy" rating for Baidu Group-SW, citing short-term pressure on advertising but stabilization trends, with AI cloud growth logic remaining intact [1] - China Hongqiao's target price raised to HKD 45 by CMB International, driven by a persistent global aluminum supply-demand gap until 2026-27, leading to a 27% and 12% upward revision in profit forecasts [1] - CMB International initiates a "Buy" rating for Innovation Industry with a target price of HKD 32, highlighting significant cost advantages from renewable energy and a clear growth path through overseas aluminum projects [1] Group 2 - Huatai Securities lowers the target price for Ausnutria to HKD 2.11 while maintaining an "Add" rating, noting ongoing pressure from declining newborn population impacting domestic infant formula sales, but strong overseas performance [2] - Dongfang Securities maintains a "Buy" rating for Geely Automobile with a target price of HKD 23.37, reporting a 121% year-on-year increase in January export sales and a 99.7% growth in the Zeekr brand [3] - Dongfang Securities also maintains a "Buy" rating for Kuaishou-W with a target price of HKD 104.36, highlighting a 112% month-on-month increase in AI overseas revenue and ongoing technological advancements [3] Group 3 - CITIC Construction maintains a "Buy" rating for Laopu Gold, noting a pre-Spring Festival buying spree and strong brand expansion, with Q1 gross margin expected to approach 40% [4] - Kaiyuan Securities initiates a "Buy" rating for Leshu Comfort, emphasizing its leading market share in Africa for baby diapers and sanitary napkins, supported by localized production and distribution channels [5] - GF Securities maintains a "Buy" rating for Meituan-W, indicating a stabilization in food delivery competition and a solid market position, with profitability expected to improve by 2026 [6] - Guoyuan International Securities maintains a "Buy" rating for Q Technology with a target price of HKD 12.89, noting a 27.2% year-on-year increase in camera module prices and a growing revenue share from non-mobile sectors [7]

Core Viewpoint - The company, LeShuShi, is a leading multinational hygiene products company in Africa, focusing on the baby diaper and sanitary napkin markets, with significant growth potential driven by demographic and economic trends in emerging markets [1][4]. Group 1: Market Position and Growth Potential - LeShuShi ranks first in the African baby diaper market and sanitary napkin market, with market shares of 20.3% and 15.6% respectively, based on 2024 sales projections [1]. - The African market is expected to see substantial growth, with a projected compound annual growth rate (CAGR) of approximately 7.0% for the baby diaper market and 13.2% for sanitary napkins from 2025 to 2029 [1][4]. Group 2: Brand and Product Strategy - LeShuShi has established a strong brand presence with a diverse brand matrix, including Softcare, Maya, Veesper, Cuettie, and Clincleer, catering to different consumer segments [2]. - The company has a robust manufacturing capability supported by local factories and a global supply chain, enabling the production of high-quality, cost-effective products [2]. Group 3: Distribution and Sales Network - The company has developed an extensive sales network across emerging markets, with 18 sales branches in 12 countries and over 2,800 wholesalers, distributors, supermarkets, and other retailers [2]. - As of April 30, 2025, revenue distribution shows West Africa contributing 39.5%, East Africa 46.5%, Central Africa 10.6%, Latin America 3.3%, and Central Asia 0.1% [3]. Group 4: Product Line Expansion - LeShuShi is expanding its product lines both vertically and horizontally, introducing products at various price points and expanding into new hygiene categories [3]. - The company has launched several brands over the years, including mid-range and high-end options, and plans to introduce more products to meet consumer demand [3]. Group 5: Financial Projections - Revenue projections for LeShuShi indicate a growth trajectory with expected revenues of $530 million, $620 million, and $720 million for the years 2025, 2026, and 2027, representing year-on-year growth rates of 17%, 16%, and 16% respectively [4]. - The company's estimated valuation for 2026 is 20.7 times earnings, compared to a sector average of 23 times [4].

Investment Rating - The report assigns a "Buy" rating for the company, marking its first coverage [4]. Core Insights - The company, Leshu Shi, is a leading player in the African hygiene products market, specializing in baby diapers and sanitary napkins, with the highest market share in both categories. The African market benefits from a demographic dividend and low penetration rates in these product categories, indicating significant growth potential. The company's strong localization capabilities are expected to drive long-term stable growth as it expands its distribution channels and product categories in Africa and replicates its operational model in other emerging markets [5][15]. Financial Summary - The company’s revenue is projected to grow from $411 million in 2023 to $712 million by 2027, with a compound annual growth rate (CAGR) of 19.2% from 2022 to 2024. The net profit is expected to increase from $65 million in 2023 to $154 million in 2027, with a CAGR of 127.4% during the same period. The gross margin is forecasted to remain stable around 35% [8][21][25]. Product and Market Positioning - Leshu Shi has developed a multi-brand strategy with a diverse product matrix, including four major brands in the baby care segment and three in the women's care segment. The company has a total of 263 SKUs for baby diapers and 44 for sanitary napkins, catering to various local needs. The company maintains the leading sales market share in Africa for both product categories, with significant growth rates outpacing competitors [6][15]. Production and Distribution Capabilities - The company operates eight factories across eight African countries, with a focus on local production to enhance cost efficiency. It has established a deep distribution network that covers over 30 countries, reaching more than 80% of the local population. This extensive network and understanding of local markets provide a competitive edge over international brands [7][15]. Regional Performance - Revenue growth varies by region, with West Africa showing stable growth, East Africa as a high-growth area, and Central Africa experiencing rapid expansion. Latin America is emerging as a new growth engine, with revenue increasing significantly from $0.004 million in 2022 to $0.09 million in 2024 [31][35][38]. Cash Flow and Liquidity - The company has seen a substantial increase in operating cash flow, rising from $0.14 million in 2022 to $1.10 million in 2024, with a CAGR of 184.1%. Cash and cash equivalents have also grown from $0.22 million to $0.31 million during the same period, indicating improved liquidity and financial stability [42][44].