Investment Rating - The report suggests a positive outlook for the liquor sector, particularly for high-end brands like Guizhou Moutai and Wuliangye, indicating a left-side configuration opportunity in the white liquor segment [3][12][14]. Core Insights - The report highlights that the core products in the liquor industry, such as Feitian Moutai and Wuliangye, have seen a rebound in wholesale prices, attributed to effective channel management by manufacturers [2][12]. - It is anticipated that the sales volume in the white liquor sector will decline by approximately 20% year-on-year, but the rate of decline is expected to narrow compared to previous months, indicating a potential stabilization in the market [11][12]. - The report emphasizes the increasing diversification of purchasing channels for liquor, with a notable shift towards online and new media platforms, which is reshaping consumer behavior [2][12][14]. Summary by Sections White Liquor - The report notes a recovery in the wholesale prices of key products, driven by improved channel management and a positive reception during the upcoming Mid-Autumn and National Day holidays [2][12]. - It suggests that the white liquor sector is entering a phase where inventory levels can be significantly reduced, leading to a temporary release of price pressure [12][14]. - Recommendations include focusing on high-end brands with strong market positions and exploring potential catalysts in the broader liquor market [3][12][14]. Beer - The beer sector is experiencing steady recovery in on-premise consumption, with companies diversifying into non-draft channels and soft drinks [14]. - The report encourages continued attention to the beer sector due to its solid performance and dividend levels [3][14]. Yellow Wine - The yellow wine industry is seeing price increases among leading brands, which may lead to a more stable competitive landscape [14]. - The report highlights the importance of marketing and product innovation in the yellow wine sector as it approaches peak season [14]. Snacks - The snack industry is maintaining high growth, with new retail channels expanding rapidly and product diversity increasing [4][15]. - The report suggests that the upcoming holiday season will boost demand for snack products, particularly nut gift boxes [4][15]. Soft Drinks - The soft drink sector is nearing the end of its peak season, with segments like energy drinks and sugar-free teas showing strong growth [4][16]. - The report indicates that traditional categories are facing challenges, but health-oriented products are performing well [4][16]. Condiments - The condiment sector is stabilizing, with expectations of demand recovery in the restaurant chain segment [5][17]. - The report recommends focusing on companies with strong competitive advantages and improving profit margins [5][17].

Investment Rating - The industry investment rating is "Positive" (maintained) [1] Core Viewpoints - The report indicates that the liquor market is showing signs of bottoming out, with a focus on three companies in the consumer goods sector. The food and beverage index declined by 2.5%, ranking 23rd among 28 sub-industries, underperforming the CSI 300 by approximately 3.6 percentage points. The soft drink sector (+0.9%), other food products (+0.0%), and meat products (-0.0%) performed relatively well [3][10][12]. Summary by Sections Weekly Insights - The liquor market is showing bottoming characteristics, with the consumer goods sector focusing on three companies. The liquor market's sales have improved slightly in Q3, but year-on-year declines persist due to the ongoing impact of alcohol bans on business consumption and overall consumer pressure [10][11]. Market Performance - The food and beverage index experienced a decline of 2.5%, ranking 23rd out of 28 sectors, and underperformed the CSI 300 by about 3.6 percentage points. The soft drink sector, other food products, and meat products showed relatively better performance [12][13]. Upstream Data - Some upstream raw material prices have decreased. For instance, the price of whole milk powder in GDT auctions was $3,790 per ton, down 0.5% month-on-month but up 9.9% year-on-year. The domestic fresh milk price was 3.0 yuan per kilogram, stable month-on-month but down 3.5% year-on-year [16][17]. Liquor Industry News - Moutai's terminal sales in September showed a year-on-year increase of over 20%. The company is deepening its reform process and emphasizing sustainable development, with an increased dividend rate [40][44]. Recommended Companies - The report recommends focusing on the following companies: 1. Ximai Food: Stable growth in the oat business, with a downward trend in raw material costs expected to continue until 2027 [11]. 2. Weilong Delicious: New product launches are expected to stabilize the noodle product line, with significant growth in the konjac category [11]. 3. Bairun Co.: The cocktail business is expected to see slight growth, with a focus on new products and whiskey brand development [11][44].

Core Viewpoint - The company has successfully transformed from a street snack into a national business over the past two decades, with a strong focus on product innovation, channel expansion, and governance efficiency [1][2] Group 1: Product and Revenue - The classic spicy strips continue to provide stable cash flow, while vegetable products like konjac and seaweed snacks are capturing the growing health-conscious demand, with projected revenue of 3.37 billion yuan in 2024, accounting for 54% of total revenue [1] - The spicy strip industry is experiencing expansion, with the company leading in the sweet and spicy segment, supported by a differentiated product strategy that includes five major flavor types [1][2] Group 2: Channel Strategy - The company has a solid foundation in traditional retail channels such as supermarkets and convenience stores, while rapidly expanding into bulk snacks and live e-commerce, achieving 94 live broadcasts on Douyin in 90 days [1] - The company employs a dual-channel strategy to enhance control over distributors, with the number of cooperative distributors increasing to 1,879, a year-on-year growth of approximately 10% [1] Group 3: Supply Chain and Governance - The company operates five direct-owned factories in Henan and has introduced 5G production lines, which have reduced costs and ensured food safety [1] - Family ownership of 78% enhances decision-making efficiency, and equity incentives are in place to bind the core team for future expansion [1] Group 4: Growth Potential in Konjac Products - The konjac food segment has shown a compound annual growth rate of over 20% from 2014 to 2023, indicating significant market potential [2] - The company is focusing on enhancing flavor research and expanding its product offerings to solidify its leading position in the konjac market [2] Group 5: Financial Projections - Revenue projections for the company are 7.517 billion yuan, 9.019 billion yuan, and 10.630 billion yuan for 2025, 2026, and 2027, respectively, with year-on-year growth rates of 20.0% for the first two years and 17.9% for 2027 [2] - Expected net profit for the same years is 1.408 billion yuan, 1.739 billion yuan, and 2.151 billion yuan, with growth rates of 31.8%, 23.5%, and 23.7% respectively [2]

Company Overview - Guotou Securities has issued a "Buy-A" investment rating for Weilong Delicious (09985) with a 6-month target price of HKD 14.27 [1] - The classic spicy strips continue to provide stable cash flow, while vegetable products like konjac and seaweed snacks are capturing the health-conscious demand, with projected revenue of CNY 3.37 billion in 2024, accounting for 54% of total revenue, marking the first time these products become the largest category [1] Industry Trends - The spicy strip industry is experiencing expansion, with flavor differentiation reshaping the competitive landscape, where Weilong's sweet and spicy flavor leads the market [2] - The industry has seen a compound annual growth rate (CAGR) of over 20% from 2014 to 2023, indicating a robust growth trajectory [3] Competitive Advantages - Weilong has established itself as a high-trust brand through automated and transparent factories, enhancing production efficiency [2] - The company employs a differentiated strategy with five major flavor categories: sweet, spicy, fragrant, durian spicy, and regional spicy, continuously innovating its product matrix [2] - Weilong has effectively turned spicy strips into a social currency among younger consumers, increasing user engagement [2] Distribution and Supply Chain - The company maintains a solid foundation in traditional channels such as supermarkets and convenience stores while rapidly expanding into bulk snacks and live e-commerce, with 94 live broadcasts on Douyin in 90 days, leading to a continuous increase in online sales proportion [1][2] - The number of cooperative distributors is expected to increase to 1,879 in 2024, a year-on-year growth of approximately 10% [2] - Weilong's supply chain includes five direct-operated factories in Henan, incorporating 5G production lines to reduce costs and ensure food safety [1] Future Outlook - The konjac food segment is still in its early growth phase, with significant market potential, and the versatility of konjac allows for extensive flavor innovation [3] - To maintain its leading position, Weilong needs to enhance flavor research and development, leverage its brand influence to promote new flavors, and expand its distribution network and SKU offerings [3]

Company Overview - Guotou Securities has given Wei Long Delicious (09985) a "Buy-A" investment rating with a 6-month target price of HKD 14.27 [1] - Wei Long's classic spicy strips continue to provide stable cash flow, while products like konjac snacks and seaweed cater to health-conscious consumers, with projected revenue of CNY 3.37 billion in 2024, accounting for 54% of total revenue, making it the largest product category for the first time [1] Industry Trends - The spicy strip industry is experiencing expansion, with flavor differentiation reshaping the competitive landscape, where Wei Long's sweet and spicy flavor leads in market size [2] - The industry has seen a compound annual growth rate (CAGR) of over 20% from 2014 to 2023, indicating robust growth potential [3] Competitive Advantages - Wei Long leverages automated and transparent factories to enhance production efficiency and establish itself as a high-trust brand among consumers [2] - The company employs a differentiated strategy with five major flavor categories: sweet, spicy, fragrant, durian spicy, and regional spicy, continuously innovating its product matrix [2] - Wei Long capitalizes on the social aspect of spicy strip consumption, positioning its products as social currency among younger consumers, thereby increasing user engagement [2] Distribution and Channel Strategy - Wei Long's traditional dual-channel strategy strengthens control over distributors, with the number of cooperative distributors expected to increase to 1,879 in 2024, a year-on-year growth of approximately 10% [2] - The company has established a multi-channel approach with "snack wholesale - online platforms - O2O," creating a comprehensive competitive advantage [2] Future Outlook - The konjac food segment is still in its early growth phase, with significant market potential, and the versatility of konjac allows for extensive flavor innovation in the midstream processing [3] - Wei Long is encouraged to enhance flavor research and development, fully utilize its brand influence to promote new flavors, and expand its distribution network and SKU offerings to solidify its leading position [3]

Investment Rating - The investment rating for the company is "Buy-A" with a target price of 14.27 CNY within six months [5][8]. Core Insights - The company has established a strong market presence in the spicy snack sector, evolving from a single product (spicy strips) to a diversified portfolio including vegetable and bean products, with a projected revenue of 33.7 billion CNY from vegetable products in 2024, accounting for 54% of total revenue [1][3][25]. - The spicy strip industry is experiencing growth, with a market size expected to exceed 700 billion CNY, driven by economic recovery and changing consumer preferences [31][34]. - The company leverages its production capabilities and marketing strategies to maintain its leading position in the spicy strip market, with a focus on product innovation and channel expansion [2][43]. Summary by Sections Company Overview - The company, established in 1999, has grown from a local snack producer to a national leader in spicy snacks, listing on the Hong Kong Stock Exchange in 2022 [14][18]. - The ownership structure is family-based, with the founding family holding approximately 78% of the shares, which enhances decision-making efficiency [22]. Product Matrix and Manufacturing System - The product range includes spicy strips, vegetable snacks, and bean products, with a focus on health-conscious offerings like konjac snacks [23][25]. - The company operates five factories in Henan, utilizing advanced production technologies, including 5G smart production lines, to enhance efficiency and ensure food safety [28][30]. Spicy Strip Market Dynamics - The spicy strip market is characterized by a growing consumer base and evolving taste preferences, with a projected compound annual growth rate of 4.2% from 2020 to 2024 [34][36]. - The company has adopted a differentiated flavor strategy, offering a variety of spicy strip flavors to cater to diverse consumer tastes [2][41]. Financial Projections - Revenue forecasts for 2025, 2026, and 2027 are 75.17 billion CNY, 90.19 billion CNY, and 106.30 billion CNY, respectively, with year-on-year growth rates of 20.0%, 20.0%, and 17.9% [4][9]. - Net profit projections for the same years are 1.408 billion CNY, 1.739 billion CNY, and 2.151 billion CNY, reflecting significant growth potential [9].

Summary of Wei Long Mei Wei Conference Call Company Overview - Wei Long Mei Wei is a leading domestic spicy snack company that started with spicy strips and has expanded into vegetable products, achieving significant growth from 2018 to 2024 [2][7]. Key Points Industry Insights - The snack food industry is a massive market, potentially reaching a trillion yuan scale. Despite disruptions from the pandemic, the industry is expanding with steady economic growth [4]. - The market is fragmented, lacking the concentration seen in industries like liquor or beer, primarily due to diverse product attributes and regional tastes in China [4]. Company Performance - Revenue from vegetable products reached 3.5 billion yuan in 2024, a nearly 60% year-on-year increase, surpassing the revenue from noodle products for the first time [2][12]. - The company expects vegetable product growth to approach 50% in 2025, with a projected overall revenue increase of over 20% [5][16]. - Online sales grew nearly 40% year-on-year in 2024, accounting for about 10% of total revenue [5][15]. Product Development - Wei Long has successfully launched new vegetable products like konjac snacks, creating a second growth curve [2][8]. - The core product, spicy strips, remains stable despite competitive pressures, with new flavors introduced to maintain market leadership [10]. - Konjac products, particularly konjac snacks, have become a significant growth driver, benefiting from the rapid development of the domestic konjac industry [11]. Competitive Advantages - The company has a stable governance structure and an experienced management team, continuously introducing external talent [9]. - Wei Long employs intelligent production and modern channel management, demonstrating excellent cost control, which supports sustainable development [9]. Future Growth Potential - The company is exploring new growth avenues beyond spicy strips and konjac, including products like stinky tofu and seaweed [14]. - The management anticipates maintaining a net profit of over 1.35 billion yuan in 2025, increasing to around 2 billion yuan by 2027, with a corresponding price-to-earnings ratio of about 20 times [5][16]. Market Trends - The snack industry has undergone significant channel transformations, with rapid growth in offline emerging channels and online social e-commerce replacing traditional shelf e-commerce [6]. - Companies that adapt to these channel changes tend to achieve better growth [6]. Margin Management - Wei Long's choice of low-cost raw materials, such as noodle and konjac products, has helped maintain a gross margin close to 50%, which is higher than the overall company level [3][13]. Conclusion - Wei Long Mei Wei is well-positioned for continued growth in the snack food industry, leveraging its innovative product development, strong management, and effective channel strategies to capitalize on market opportunities and consumer trends [2][8][16].

Core Insights - The collaboration between Huang Zihongfan and Weilong aims to create a strong emotional connection with young consumers, positioning the brand as a "happy lifestyle" representative [2][6] - The launch of the new Spicy Lobster Flavor snack is designed to enhance brand recognition and appeal to the youth market by transforming the consumption experience into a joyful emotional context [2][6] Product Innovation - Weilong's classic product, the Spicy Gluten Snack, has been revamped to retain its core advantages while incorporating elements that resonate with young consumers [4] - The new product features a unique non-fried process that locks in flavors, providing a satisfying taste experience without overwhelming spiciness [4] - The independent packaging is designed for convenience, making it suitable for various social scenarios, thus lowering the barrier for trial [4] Marketing Strategy - The dual approach of introducing a brand ambassador alongside a classic product innovation is aimed at closely connecting with the younger demographic [6] - Huang Zihongfan's energetic image is leveraged to transform Weilong from a familiar snack brand into a "happy partner" that understands the preferences of young consumers [6] Future Directions - Weilong plans to continue engaging with young consumers through collaborations and scenario-based marketing, ensuring that classic snacks remain relevant in their daily lives [7]

Core Viewpoint - Wei Long has officially announced Huang Zihongfan as the spokesperson for its spicy snack product, specifically promoting the spicy crayfish-flavored snack [1] Group 1: Brand Endorsements - Wei Long has previously announced multiple brand ambassadors for its products this year, including Wang Anyu for the Wei Long konjac product in April [1] - In August, Wei Long signed Guan Le as the brand ambassador for its seaweed product line [1]

Core Viewpoint - Wei Long Mei Wei (09985) is positioned as the leader in the spicy snack industry, with significant growth potential driven by channel expansion and category benefits, expecting rapid earnings growth in the coming years [1][2]. Group 1: Company Overview - Wei Long was established in 2001 in Luohe, Henan, starting with spicy strips and later launching the popular konjac product in 2014, which became a phenomenon [1]. - The company is projected to achieve revenue of 6.266 billion yuan in 2024, with vegetable products surpassing spicy strips as the primary growth driver [1]. Group 2: Industry Dynamics - The spicy snack industry in China is expected to reach a scale of 228.4 billion yuan in 2024, with a 7-year CAGR of 9%, significantly outpacing the overall snack market [2]. - Wei Long holds a 28% market share in spicy strips as of 2023, with the market size for spicy strips projected to be 61.5 billion yuan in 2024 [2]. - The konjac snack industry is anticipated to grow to approximately 16.4 billion yuan by 2025, with Wei Long commanding a 56% market share [2]. Group 3: Brand and Product Strategy - Wei Long has established a strong brand presence as a leader in the spicy snack sector, enhancing its brand image through production line upgrades [3]. - The company is focusing on product price increases to maintain gross margin, with expectations of reaching a scale of 4 billion yuan in the medium term [3]. - The expansion into new channels, including high-potential platforms like Sam's Club and Douyin, is expected to enhance market penetration and capitalize on industry channel evolution [3].