申万宏源研究 上海市南京东路99号 | +86 21 2329 7818 www.swsresearch.com 简单金融 成就梦想 食品饮料 | 公司点评 23 年收入利润超预期 24 年全国化潜力验证 2024年3月11日 珍酒李渡(06979:HK) 事件：公司公告2023年盈利预告，2023年公司实现营业收入不低于70亿元（人民币， 买入 下同），测算同比增长不低于19.5%；净利润不低于23 亿元；Non-GAAP净利润不低于 16亿元，测算同比增长不低于33%。公司业绩略高于我们预期。 有业绩公布需要点评 投资分析意见：由于公司公告业绩快报略高于预期，且春节期间产品动销表现积极，略上 调盈利预测，预测 2023~2025 年珍酒实现营业收入 70.4/81.5/92.6 亿（前次为 69/80/90.7 亿），分别同比增长 20%/16%/14%，剔除股权激励、股份支付以及公允价 市场数据：2024年3月8日 值变动等影响后的Non-GAAP净利润分别为16.4/20/23.7亿（前次为16/20/23亿）， 收盘价（港币） 9.40 分别同比增长37%/22%/18%，对应PE分别为21/17/ ...

%% research.95579.com %% ...

公司研 究 证 券研究 报 告 食品饮料 2024年03月12日 珍 酒李渡（06979.HK）2023年业绩预告点评 强 推 （维持） 目标价：14港元 23 顺利收官，24 趋势延续 当前价：10.14港元 事项： 华创证券研究所  公司发布2023年盈利预告，预计23年实现总营收超70亿元，同增超19.5%， 证券分析师：沈昊 归母净利润/Non-GAAP净利润超23/16亿元，同增超123.3%/33.6%。测算23H2 收入超34.8亿元，同增超24.6%，归母净利润/Non-GAAP净利润超7.1/8.0亿 邮箱：shenhao@hcyjs.com 元，同增超41.6%/47.8%。 执业编号：S0360521050001 评论： 证券分析师：欧阳予  收入环比加速，利润弹性释放。公司23H2收入同增超24.6%，下半年环比提 邮箱：ouyangyu@hcyjs.com 速明显，考虑系22Q4及23Q1场景限制导致基数较低所致，23H2 Non-GAAP 执业编号：S0360520070001 净利润同增超47.8%，考虑系产品结构提升叠加成本优化带动毛利提升，22年 证券分析师：田晨曦 下半 ...

Investment Rating - The report assigns a "Buy" rating for the company, with a target price of HKD 13.89 per share based on a 20x PE for 2024 [3][11]. Core Views - The company, Zhenjiu Lidu, is a high-growth white liquor enterprise with multiple brands and flavor types, benefiting from the "sauce liquor boom" and a strong brand presence [2][10]. - The management team is experienced, with an average of 17 years in the industry, led by Wu Xiangdong, who has over 20 years of operational experience [2][33]. - The company is expected to see significant profit growth, with net profits projected to reach HKD 16.48 billion, HKD 21.58 billion, and HKD 26.99 billion from 2023 to 2025, representing year-on-year growth rates of 60%, 31%, and 25% respectively [2][11]. Summary by Sections Company Overview - Zhenjiu Lidu operates multiple brands, including its flagship sauce liquor brand Zhenjiu and the semi-high-end Jiangxi Lidu, along with regional leaders Xiangjiao and Kaikouxiao [2][18]. - The company has a concentrated ownership structure, with Wu Xiangdong holding 81.3% of the shares, ensuring stable management [29][31]. Market Position and Growth Drivers - The company benefits from the ongoing trend of sauce liquor, which, despite only accounting for 8.4% of total liquor production, contributes 31.5% of industry revenue and over 45% of profits [2][45]. - Zhenjiu's product strategy includes a clear upward price extension, with flagship products like Zhen 15 and Zhen 30 driving growth in the high-end market [2][9]. Financial Performance and Projections - The company reported revenues of HKD 5.1 billion in 2021 and HKD 5.9 billion in 2022, with projections of HKD 7.1 billion, HKD 8.5 billion, and HKD 10.2 billion for 2023 to 2025, respectively [7][19]. - The net profit for 2022 was HKD 1.03 billion, with forecasts of HKD 1.65 billion, HKD 2.16 billion, and HKD 2.70 billion for the following three years [7][11]. Competitive Landscape - The company is positioned as a second-tier leader in the sauce liquor market, with a strong brand effect that allows it to maintain growth even as the overall market experiences pressure [10][11]. - The competitive strategy includes a diversified product range and a well-structured distribution network, enhancing market penetration and brand loyalty [2][9].

[Table_Main] 证券研究报告 | 公司点评 珍酒李渡(6979.HK) 2024年03月09日 买入（维持） 珍酒李渡（6979.HK）：李渡核心大单 所属行业：必需性消费/食物饮品 品提价，有望持续提升品牌价值 当前价格(港币)：9.40元 证券分析师 投资要点 熊鹏 资格编号：S0120522120002 事件：近日，李渡酒业宣布，第二代李渡高粱1955正式上市，是近十年首次换代，  邮箱：xiongpeng＠tebon.com.cn 价格上调为1230元/瓶。2月18日，李渡酒业曾宣布，停止生产第一代500ml装 研究助理 李渡高粱1955与1975。 李渡1955近年来多次提价，此次提价有望进一步提升品牌价值。李渡1955近年  来多次提价：17年8月零售价上涨100元至580元；19年5月提价至770元； 市场表现 19年12月提价至850元；20年6月提价至900元；20年9月提价至950元； 珍酒李渡 恒生指数 20年11月提价至1010元；21年2月提价至1050元。2022年李渡品牌实现营 57% 收 8.9 亿元（占比 15.1%），其中次高端及以上产品营收 6.8 亿元。2 ...

Group 1 - The stock of Zhenjiu Lidu (06979) has increased by over 4%, currently trading at 8.91 HKD with a transaction volume of 27.87 million HKD [1] - According to a survey by Founder Securities during the Spring Festival, Zhenjiu's repayment progress and terminal sales performance are superior compared to similar sauce liquor brands, with distributors completing approximately 30% of repayments [1] - The Zhen 15 product line has received positive feedback and shows significant growth, with stable pricing around 340 RMB, and is expected to see further increases post-holiday [1] Group 2 - Longcheng Securities indicates that Zhenjiu Lidu's management has extensive experience in the liquor industry, showcasing outstanding management and marketing capabilities, leading to impressive growth in recent years [1] - The company is expected to benefit from the industry's structural development, particularly from the high-end market and flavor premium, with a high certainty of performance growth [1] - Following its public financing, Zhenjiu Lidu is anticipated to overcome current production capacity constraints in the coming years, with improving gross margins and expense ratios, leading to a positive cycle in profitability [1]

证券研究报告 | 公司动态点评 2024 年 02月 19日 珍酒李渡（06979.HK） 春节反馈积极，板块信心提振，长期优化明确 财务指标 2021A 2022A 2023E 2024E 2025E 买入（维持评级） 营业收入（百万元） 5102 5856 7161 8699 10494 股票信息 增长率yoy（%） 112.7 14.8 22.3 21.5 20.6 归母净利润（百万元） 1032.20 1029.87 1619 2102 2698 行业 食品饮料 增长率yoy（%） 98.5 -0.2 57.2 29.8 28.4 2024年2月16日收盘价（港元） 8.660 ROE（%） -15.1 -27.0 -73.7 -2233.4 103.6 总市值（百万港元） 29,345.48 EPS最新摊薄（元） 0.30 0.30 0.48 0.62 0.80 流通市值（百万港元） 29,345.48 P/E（倍） 28.4 28.5 18.1 14.0 10.9 总股本（百万股） 3,388.62 P/B（倍） -4.3 -7.7 -13.4 -311.8 11.3 流通股本（百万股） 3,38 ...

智通财经APP获悉，珍酒李渡(06979)早盘跌超7%，截至发稿，跌6.93%，报8.06港元，成交额5942.62万港元。 申万宏源指出，春节销售基本完成，结合渠道反馈，我们认为，春节销售情况好于此前市场悲观预期，头部品牌的需求仍然有很强的韧性，动销同比均有增长，但增长幅度不大。从渠道质量来看，价格表现基本稳定，库存尽管承压但未出现较大风险。受宏观经济影响，行业整体需求短期仍有压力，但头部集中、分化加剧的大趋势不变。 方正证券近期表示，根据该行春节期间渠道调研反馈，珍酒回款进度、终端动销均较同类酱酒品牌中表现更优，经销商普遍回款已完成约30%，动销方面，珍15单品表现突出反馈良好有明显增量，批价稳定在340元左右预计节后仍将有所回升。该行预计公司整体全年收入望达84亿元(同比增速20%左右)，Non-Gaap净利润望达20亿元(同比增速约25%+)，开门红超预期完成下全年销售仍有较大空间。 ...

Financial Performance - For the six months ended June 30, 2023, revenue increased by 15.0% to RMB 3,518,957,000 compared to RMB 3,060,981,000 in the same period of 2022[16]. - Gross profit rose by 19.6% to RMB 2,037,148,000, up from RMB 1,703,043,000 year-on-year[16]. - Profit attributable to equity shareholders surged by 202.1% to RMB 1,584,899,000, compared to RMB 524,674,000 in the previous year[16]. - Adjusted net profit increased by 22.0% to RMB 802,519,000 from RMB 657,638,000 in the same period last year[16]. - Net cash generated from operating activities improved significantly to RMB 215,960,000, compared to a cash outflow of RMB 665,341,000 in the prior year[16]. - The net increase in cash and cash equivalents was RMB 4,190,228,000, a rise of 128.3% from RMB 1,835,756,000[16]. - Basic earnings per share rose by 156.5% to RMB 0.59, compared to RMB 0.23 in the same period of 2022[16]. - Net profit margin increased to 45.0%, up from 17.1% in the previous year[19]. - Adjusted net profit margin was 22.8%, compared to 21.5% in the same period last year[19]. Revenue Contribution by Brand - For the six months ended June 30, 2023, Zhen Jiu contributed approximately 65.5% of the company's revenue, while Li Du accounted for about 13.9%[28][33]. - Revenue from the Zhen Jiu brand grew by 14.9% to RMB 2,305.87 million, driven by higher sales in the deluxe and mid-range products, as well as an expanded sales network[96]. - Li Du brand revenue increased by 16.7% to RMB 489.22 million, attributed to growth in premium and mid-range products and nationwide sales network expansion[96]. - Xiang Jiao brand revenue rose by 17.3% to RMB 441.99 million, primarily due to increased sales from high-end products represented by the Long Jiang series[96]. - Kai Kou Xiao brand revenue grew by 6.5% to RMB 221.00 million, resulting from continuous optimization of sales channels[96]. Product Development and Innovation - The company launched three new package-free baijiu products in the first half of 2023, enhancing its product line in the deluxe and premium price ranges[32]. - The launch of the new sub-brand Ying Shan Hong targets the mid-range market through online sales channels[32]. - The company is focused on optimizing its distributor base to improve overall performance and profitability[26]. - The company has accumulated sufficient base liquor inventory to support the rapid growth of its premium and deluxe baijiu products[54]. - The company collaborates with several universities and research institutions to enhance product development capabilities[47]. Production Capacity and Facilities - As of June 30, 2023, the company operated seven production facilities in China, equipped with advanced facilities and automated production lines[53]. - The expansion of the Zhen Jiu (Mao Tai Zhen Shuang Long) production facility is expected to increase annual production capacity by 2,400 tons of sauce aroma base liquor in the second half of 2023[75][83]. - A new production facility, Li Du (Zheng Jia Shan), has been put into operation with a designed production capacity of 5,000 tons of base liquor per year[75][83]. - The company is expanding the existing Xiang Jiao (Jiang Bei) production facility, increasing its designed production capacity by 4,400 tons of base liquor per year[75][83]. Sales and Distribution Strategy - The company aims to optimize its existing distributor network and enhance product turnover to improve sell-through rates[70]. - The number of distribution partners increased from 2,678 as of December 31, 2022, to 2,811 as of June 30, 2023, representing a growth of approximately 4.97%[61]. - The total number of distributors across all channels rose from 6,618 as of December 31, 2022, to 6,898 as of June 30, 2023, indicating an increase of about 4.23%[61]. - Revenue from distributors accounted for 87.9% of total revenue, amounting to RMB 3,092.93 million, while direct sales contributed 12.1% with RMB 426.02 million[106]. Cost Management and Profitability - Cost of sales increased by 9.1% to RMB 1,481.8 million for the six months ended June 30, 2023, from RMB 1,357.9 million in the previous year[111]. - Selling and distribution expenses rose by 18.7% from RMB 682.1 million for the six months ended June 30, 2022, to RMB 809.3 million for the six months ended June 30, 2023[134]. - Administrative expenses increased by 40.7% from RMB 167.3 million for the six months ended June 30, 2022, to RMB 235.5 million for the six months ended June 30, 2023[139]. - The company focused on enhancing revenue contribution from products with higher gross profit margins, particularly in the premiumization strategy[132]. Environmental and Social Responsibility - The company achieved a 46% reduction in water usage intensity and a 44% reduction in carbon emission intensity compared to the first half of 2022, demonstrating significant progress in ESG initiatives[189]. - The company plans to implement over 100 ESG enhancement tasks in the coming six months, including baijiu bottle recycling and monitoring of GHG emissions[193]. - A photovoltaic project at Xiang Jiao distillery has been completed, generating an expected annual power output of 3,800 megawatts, which will meet nearly half of its future electricity demand[194]. - In the first half of 2023, the group donated a total of RMB 12.93 million, with RMB 6.42 million allocated to education and RMB 5.95 million for building a fire station[199]. Employee and Workforce Development - As of June 30, 2023, the company had 11,044 full-time employees, an increase from 10,976 employees as of December 31, 2022[184]. - Employee costs for the six months ended June 30, 2023, amounted to approximately RMB 576.5 million, reflecting the company's ongoing investment in workforce training and development[185]. - Training and job rotation opportunities were provided for female employees, specifically for forklift and crane driver positions[200]. - Activities were organized for International Women's Day to promote a female-friendly workplace[200].

```markdown [Financial Highlights](index=1&type=section&id=%E8%B2%A1%E5%8B%99%E6%91%98%E8%A6%81) Presents key financial performance indicators for H1 2023, showing significant growth in profit and operating cash flow, alongside improved margins Key Financial Data for the Six Months Ended June 30, 2023 | Indicator | H1 2023 (RMB Thousands) | H1 2022 (RMB Thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 3,518,957 | 3,060,981 | 15.0% | | Gross Profit | 2,037,148 | 1,703,043 | 19.6% | | Profit Attributable to Equity Holders | 1,584,899 | 524,674 | 202.1% | | Adjusted Net Profit (Non-IFRS) | 802,519 | 657,638 | 22.0% | | Net Cash from Operating Activities | 215,960 | (665,341) | 132.5% | | Basic EPS (RMB) | 0.59 | 0.23 | 156.5% | Key Financial Ratios for the Six Months Ended June 30, 2023 | Ratio | H1 2023 (%) | H1 2022 (%) | | :--- | :--- | :--- | | Gross Profit Margin | 57.9 | 55.6 | | Net Profit Margin | 45.0 | 17.1 | | Adjusted Net Profit Margin (Non-IFRS) | 22.8 | 21.5 | [Management Discussion and Analysis](index=3&type=section&id=%E7%AE%A1%E7%90%86%E5%B1%A4%E8%A8%8E%E8%AB%96%E5%8F%8A%E5%88%86%E6%9E%90) [Business Review](index=3&type=section&id=%E6%A5%AD%E5%8B%99%E5%9B%9E%E9%A1%A7) The Group, a leading Baijiu company in China, achieved sustainable and high-quality growth in the first half of 2023. This was driven by the rising popularity of sauce-aroma Baijiu and a strategic focus on product premiumization, channel optimization, and maintaining healthy inventory levels. The company operates four major brands: Zhenjiu, Lidu, Xiangjiao, and Kaikouxiao - The company is the **fourth-largest** private Baijiu company in China by 2022 revenue, with sauce-aroma Baijiu as its main growth engine[5](index=5&type=chunk) - Strategic focus in H1 2023 included: (i) optimizing product structure towards high-end and higher-margin products, (ii) developing mid-range products, (iii) accelerating channel turnover, (iv) maintaining healthy distributor inventory, and (v) optimizing the distributor network[5](index=5&type=chunk) [Our Brands and Products](index=3&type=section&id=%E6%88%91%E5%80%91%E7%9A%84%E5%93%81%E7%89%8C%E5%8F%8A%E7%94%A2%E5%93%81) - The flagship brand, Zhenjiu, is the **fifth-largest** sauce-aroma Baijiu brand in China by 2022 revenue and contributed approximately **65.5%** of the Group's total revenue in H1 2023[7](index=7&type=chunk) - The Lidu brand, a high-growth potential brand, is the **fifth-largest** mixed-aroma Baijiu brand in China by 2022 revenue and contributed about **13.9%** of total revenue in H1 2023[9](index=9&type=chunk) - The regional leading brands, Xiangjiao and Kaikouxiao, contributed approximately **12.6%** and **6.3%** of total revenue in H1 2023, respectively[10](index=10&type=chunk)[11](index=11&type=chunk) [Product Development](index=5&type=section&id=%E7%94%A2%E5%93%81%E9%96%8B%E7%99%BC) - As of June 30, 2023, the product development team consisted of **210 employees**, led by a technical committee of **28** renowned Baijiu experts[12](index=12&type=chunk) - The company enhances its R&D capabilities through collaborations with universities like Jiangnan University, retaining ownership of jointly developed patents[12](index=12&type=chunk) [Production Facilities](index=6&type=section&id=%E7%94%A2%E7%94%9F%E8%A8%AD%E6%96%BD) - As of 2022 end, Zhenjiu ranked **fourth-largest** in China and **third-largest** in Guizhou for sauce-aroma base liquor annual production capacity[13](index=13&type=chunk) - A large inventory of base liquor is a core competitive advantage, enabling the company to support its high-end product growth and gradually replace third-party procurement, thereby improving gross margins[13](index=13&type=chunk) [Sales Channels](index=6&type=section&id=%E9%8A%B7%E5%94%AE%E6%B8%A0%E9%81%93) Number of Distributors by Channel | Channel Type | As of June 30, 2023 | As of Dec 31, 2022 | | :--- | :--- | :--- | | Distributor Partners | 2,678 | 2,811 | | Experience Stores | 1,074 | 1,071 | | Retailers | 2,866 | 3,016 | | **Total** | **6,618** | **6,898** | [Digital Infrastructure](index=7&type=section&id=%E6%95%B8%E5%AD%97%E5%9F%BA%E7%A4%8E%E8%A8%AD%E6%96%BD) - The company utilizes a proprietary WeChat mini-program, '渠道通' (Channel Connect), to enhance transparency and efficiency in the distribution channel, allowing for real-time management of procurement, inventory, and sales[16](index=16&type=chunk) - A QR code system is implemented on all Baijiu products to track the entire distribution process, enabling better control, identification of improper practices, and verification of inventory levels[16](index=16&type=chunk) [Latest Business Developments](index=7&type=section&id=%E6%A5%AD%E5%8B%99%E6%9C%80%E6%96%B0%E7%99%BC%E5%B1%95) - In H1 2023, the company launched three new high-end and sub-premium 'light bottle' (unpackaged) products, contributing to revenue growth and brand recognition[17](index=17&type=chunk) - Production capacity was expanded: the Lidu Zhengjiashan facility (**5,000 tons/year** design capacity) became operational, and the Xiangjiao (Jiangbei) facility increased its base liquor capacity by **4,400 tons/year**[18](index=18&type=chunk) - The company's shares were successfully listed on the Main Board of the Hong Kong Stock Exchange on April 27, 2023[19](index=19&type=chunk) [Prospects and Outlook](index=9&type=section&id=%E5%89%8D%E6%99%AF%E5%B1%95%E6%9C%9B) The Group is confident in its long-term development and its business prospects for the second half of 2023. It plans to continue its product premiumization strategy, enhance marketing to drive channel turnover, optimize its distributor network, and expand production capacity to capture market opportunities arising from the trends of premiumization, the rise of sauce-aroma Baijiu, and market consolidation - The company will continue to expand its product offerings in the sub-premium and above categories to align with its premiumization strategy[20](index=20&type=chunk) - Plans are in place to continue expanding production facilities, including Zhenjiu (Zhaojiagou) and Zhenjiu (Moutai Town Shuanglong). The latter is expected to add **2,400 tons** of annual base liquor capacity in H2 2023[20](index=20&type=chunk) [Financial Review](index=10&type=section&id=%E8%B2%A1%E5%8B%99%E5%9B%9E%E9%A1%A7) [Revenue](index=10&type=section&id=%E6%94%B6%E5%85%A5) Total revenue increased by 15.0% YoY to RMB 3,519.0 million in H1 2023. Growth was observed across all four major brands, driven by product mix optimization towards higher-end products and expansion of sales channels. Notably, revenue from high-end products surged by 32.0% Revenue by Baijiu Brand (H1 2023 vs H1 2022) | Brand | H1 2023 Revenue (RMB Thousands) | H1 2022 Revenue (RMB Thousands) | YoY Growth (%) | | :--- | :--- | :--- | :--- | | Zhenjiu | 2,305,867 | 2,007,262 | 14.9% | | Lidu | 489,224 | 419,102 | 16.7% | | Xiangjiao | 441,990 | 376,652 | 17.3% | | Kaikouxiao | 221,003 | 207,575 | 6.5% | Revenue by Price Range (H1 2023 vs H1 2022) | Price Range | H1 2023 Revenue (RMB Thousands) | H1 2022 Revenue (RMB Thousands) | YoY Growth (%) | | :--- | :--- | :--- | :--- | | High-end | 925,953 | 701,557 | 32.0% | | Sub-premium | 1,267,692 | 1,271,415 | -0.3% | | Mid-end & Below | 1,325,312 | 1,088,009 | 21.8% | Revenue by Sales Channel (H1 2023 vs H1 2022) | Sales Channel | H1 2023 Revenue (RMB Thousands) | H1 2022 Revenue (RMB Thousands) | YoY Growth (%) | | :--- | :--- | :--- | :--- | | Distributors | 3,092,934 | 2,757,464 | 12.2% | | Direct Sales | 426,023 | 303,517 | 40.4% | [Gross Profit and Gross Margin](index=13&type=section&id=%E6%AF%9B%E5%88%A9%E5%8F%8A%E6%AF%9B%E5%88%A9%E7%8E%87) Gross profit increased by 19.6% YoY to RMB 2,037.1 million. The overall gross margin improved to 57.9% from 55.6% in the prior year period. This improvement was primarily due to the optimization of the product portfolio towards higher-margin, high-end products and the increased use of self-produced base liquor, which has a lower unit cost than sourced liquor - Overall gross margin increased from **55.6%** in H1 2022 to **57.9%** in H1 2023[31](index=31&type=chunk) Gross Margin by Baijiu Brand (H1 2023 vs H1 2022) | Brand | H1 2023 Gross Margin (%) | H1 2022 Gross Margin (%) | | :--- | :--- | :--- | | Zhenjiu | 58.0% | 55.0% | | Lidu | 68.8% | 69.1% | | Xiangjiao | 60.2% | 59.7% | | Kaikouxiao | 42.5% | 39.6% | Gross Margin by Price Range (H1 2023 vs H1 2022) | Price Range | H1 2023 Gross Margin (%) | H1 2022 Gross Margin (%) | | :--- | :--- | :--- | | High-end | 70.3% | 65.4% | | Sub-premium | 65.3% | 64.3% | | Mid-end & Below | 42.1% | 39.2% | [Expenses](index=14&type=section&id=%E9%96%8B%E6%94%AF) Operating expenses increased during the period. Selling and distribution expenses rose 18.7% to RMB 809.3 million, mainly due to a 32.5% increase in employee compensation from sales team expansion. Administrative expenses grew 40.7% to RMB 235.5 million, driven by higher staff costs and RMB 19.4 million in IPO-related expenses - Selling and distribution expenses increased by **18.7%** to **RMB 809.3 million**, primarily due to a **32.5%** rise in employee compensation[37](index=37&type=chunk) - Administrative expenses increased by **40.7%** to **RMB 235.5 million**, mainly due to higher staff costs and an increase of **RMB 19.4 million** in listing expenses[38](index=38&type=chunk) [Profit for the Period](index=15&type=section&id=%E6%9C%9F%E5%85%A7%E5%88%A9%E6%BD%A4) Profit for the period attributable to equity holders of the company saw a substantial increase of 202.1%, rising from RMB 524.7 million in H1 2022 to RMB 1,584.9 million in H1 2023. This was significantly impacted by a non-cash gain on the fair value change of financial instruments issued to an investor - Profit for the period increased by **202.1%** to **RMB 1,584.9 million**[42](index=42&type=chunk) [Non-IFRS Measures](index=16&type=section&id=%E9%9D%9E%E5%9C%8B%E9%9A%9B%E8%B2%A1%E5%8B%99%E5%A0%B1%E5%91%8A%E6%BA%96%E5%89%87%E8%A8%88%E9%87%8F) Adjusted net profit, a non-IFRS measure that excludes items like listing expenses and fair value changes of financial instruments, increased by 22.0% to RMB 802.5 million. The adjusted net margin improved from 21.5% to 22.8%, reflecting stronger underlying operational profitability Reconciliation of Profit to Adjusted Net Profit (Non-IFRS) | Item (RMB Thousands) | H1 2023 | H1 2022 | | :--- | :--- | :--- | | Profit attributable to equity holders | 1,584,899 | 524,674 | | Add: Listing expenses | 32,535 | 13,185 | | Add/Less: Fair value change of financial instruments | (814,915) | 119,779 | | **Adjusted Net Profit (Non-IFRS)** | **802,519** | **657,638** | - Adjusted net profit increased by **22.0%** YoY, and the adjusted net margin rose to **22.8%** from **21.5%**[45](index=45&type=chunk) [Liquidity and Capital Resources](index=17&type=section&id=%E6%B5%81%E5%8B%95%E8%B3%87%E9%87%91%E5%8F%8A%E8%B3%87%E6%9C%AC%E8%B3%87%E6%BA%90) The Group's liquidity position strengthened significantly, with cash and bank balances increasing to approximately RMB 6,090.9 million as of June 30, 2023, from RMB 1,683.4 million at the end of 2022, primarily due to net proceeds from the global offering. The gearing ratio was not applicable due to a net cash surplus position - Cash and bank balances stood at **RMB 6,090.9 million** as of June 30, 2023[46](index=46&type=chunk) - Total capital expenditure for H1 2023 was approximately **RMB 564.5 million**, compared to **RMB 699.2 million** in H1 2022[48](index=48&type=chunk) [Consolidated Financial Statements](index=19&type=section&id=%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8) [Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=19&type=section&id=%E7%B6%9C%E5%90%88%E6%90%8D%E7%9B%8A%E5%8F%8A%E5%85%B6%E4%BB%96%E5%85%A8%E9%9D%A2%E6%94%B6%E7%9B%8A%E8%A1%A8) The statement details the Group's financial performance for the six months ended June 30, 2023, showing a revenue of RMB 3,519.0 million and a profit attributable to equity holders of RMB 1,584.9 million [Consolidated Statement of Financial Position](index=20&type=section&id=%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E7%8B%80%E6%B3%81%E8%A1%A8) The statement presents the Group's financial position as of June 30, 2023. Total assets amounted to RMB 16,205.1 million, and total equity attributable to owners of the company was RMB 11,983.3 million, a significant turnaround from a total equity deficit of RMB 3,815.2 million at the end of 2022, mainly due to the conversion of preferred shares to equity upon IPO - Total assets were **RMB 16,205.1 million** (sum of non-current and current assets)[52](index=52&type=chunk) - Inventories increased to **RMB 5,525.3 million** from **RMB 5,138.5 million** at year-end 2022[52](index=52&type=chunk) - Total equity turned positive to **RMB 11,983.3 million** from a deficit of **RMB 3,815.2 million**, primarily because the financial liability for preferred shares (**RMB 10,253.8 million**) was converted to equity upon the IPO[53](index=53&type=chunk) [Notes to the Financial Statements](index=22&type=section&id=%E9%99%84%E8%A8%BB) [Summary of Notes to Financial Statements](index=22&type=section&id=%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8%E9%99%84%E8%A8%BB%E6%91%98%E8%A6%81) This section provides detailed explanations for the figures presented in the consolidated financial statements. Key notes include the basis of preparation, changes in accounting policies, detailed revenue and segment reporting, breakdown of expenses, calculation of earnings per share, and details on financial instruments. The interim financial report is unaudited but has been reviewed by KPMG - The interim financial report was prepared in accordance with International Accounting Standard 34 'Interim Financial Reporting' and has been reviewed by KPMG[54](index=54&type=chunk)[55](index=55&type=chunk) - Segment reporting is managed by brand (Zhenjiu, Lidu, Xiangjiao, Kaikouxiao, Others), with performance assessed based on gross profit[59](index=59&type=chunk)[61](index=61&type=chunk) - The financial liability related to Series A preferred shares was fully converted into the company's ordinary shares upon the IPO on April 27, 2023[79](index=79&type=chunk) [Other Information](index=31&type=section&id=%E5%85%B6%E4%BB%96%E8%B3%87%E6%96%99) [Dividends, Repurchases, and Post-Period Events](index=31&type=section&id=%E8%82%A1%E6%81%AF%E3%80%81%E5%9B%9E%E8%B3%BC%E5%8F%8A%E6%9C%9F%E5%BE%8C%E4%BA%8B%E9%A0%85) The Board of Directors did not recommend an interim dividend for H1 2023. The company did not purchase, sell, or redeem any of its listed securities during the period. A significant post-period event was the company's inclusion as a constituent stock of the Hang Seng Composite Index, effective September 4, 2023 - The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2023[81](index=81&type=chunk) - Post-period, the company was selected for inclusion in the Hang Seng Composite Index, effective September 4, 2023[82](index=82&type=chunk) [Use of Proceeds from Global Offering](index=31&type=section&id=%E5%85%A8%E7%90%83%E7%99%BC%E5%94%AE%E6%89%80%E5%BE%97%E6%AC%BE%E9%A0%85%E7%94%A8%E9%80%94) The net proceeds from the global offering on April 27, 2023, were approximately HK$4,990.0 million. As of June 30, 2023, about HK$762.4 million had been utilized, primarily for the construction and development of production facilities and for brand building. The remaining funds are intended to be used as planned by the end of 2027 Use of Net Proceeds from Global Offering as of June 30, 2023 | Use of Proceeds | Allocation (%) | Net Proceeds (HK$ Million) | Utilized Amount (HK$ Million) | Unutilized Amount (HK$ Million) | | :--- | :--- | :--- | :--- | :--- | | Production facilities construction | 55% | 2,744.5 | 498.8 | 2,245.7 | | Brand building & marketing | 20% | 998.0 | 222.5 | 775.5 | | Expansion of sales channels | 10% | 499.0 | 35.1 | 463.9 | | Business automation & digitalization | 5% | 249.5 | 6.1 | 243.4 | | Working capital & general corporate | 10% | 499.0 | - | 499.0 | | **Total** | **100%** | **4,990.0** | **762.4** | **4,227.6** | [Corporate Governance](index=32&type=section&id=%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB) [Compliance and Audit Committee](index=32&type=section&id=%E5%90%88%E8%A6%8F%E5%8F%8A%E5%AF%A9%E8%A8%88%E5%A7%94%E5%93%A1%E6%9C%83) The company has complied with all code provisions of the Corporate Governance Code from its listing date to June 30, 2023. The Board has established an Audit Committee, which has reviewed the unaudited interim financial results and discussed accounting principles, internal controls, and financial reporting matters with management - The company has complied with all code provisions of the Corporate Governance Code since its listing date[86](index=86&type=chunk) - The Audit Committee, comprising two independent non-executive directors and one non-executive director, has reviewed the unaudited financial results for H1 2023[88](index=88&type=chunk) ```