Company Overview - Wanchen Group has been actively expanding its snack retail business since 2022, acquiring and integrating five major brands to establish a second growth curve [3] - The company has a concentrated ownership structure, with Wang Zenning as the controlling shareholder, holding approximately 34.6% of the shares [3] Industry Insights - The snack retail market in China has shown significant growth, with the market size increasing from 21.1 billion yuan in 2019 to 80.9 billion yuan in 2023, representing a CAGR of about 40% [2] - The number of snack retail stores is expected to reach 45,000 by 2025, indicating substantial expansion potential in the industry [2] Financial Performance - Wanchen Group's snack retail revenue is projected to reach 31.79 billion yuan in 2024, with a net profit of 860 million yuan, reflecting a year-on-year growth of 128% and 251% respectively [4] - The company has over 15,000 stores, with rapid growth in store numbers being a key driver of revenue increase [4] Profitability and Cost Management - The scale effect from increasing revenue and store density is expected to enhance profit margins, with continuous cost reduction efforts [5] - Wanchen Group is actively developing its own brands, which is anticipated to further improve profitability [5] Strategic Initiatives - The company is focusing on brand building and has begun to introduce IP-derived products to enhance consumer engagement [6] - Wanchen Group is transitioning towards a discount retail model, launching "Lai You Pin" and "Hao Xiang Lai" stores, expanding product categories beyond snacks to include daily necessities and fresh produce [6] Investment Outlook - The company is expected to achieve revenues of 54.2 billion yuan, 63.4 billion yuan, and 71.6 billion yuan from 2025 to 2027, with net profits of 770 million yuan, 1.08 billion yuan, and 1.3 billion yuan respectively [6] - A target price of 184.01 yuan has been set, indicating approximately 20% upside potential from the current valuation [6]