Core Viewpoint - The report from Industrial Securities initiates coverage on October Rice Field (09676) with a "Buy" rating, projecting revenue and net profit growth for 2025, 2026, and 2027, driven by the health food trend and the company's focus on mid-to-high-end rice and corn businesses [1] Group 1: Company Overview - October Rice Field is a leading staple food company in China, with major business segments including rice, corn, grains, beans, and other products [1] - In the first half of 2025, the company reported a revenue increase of 16.9% year-on-year to 3.06 billion yuan, with adjusted net profit rising 97.7% to 290 million yuan [1] - In the third quarter of 2025, revenue is expected to grow approximately 25.7%-31.5%, with operating profit increasing by about 71.5%-90.5% [1] Group 2: Revenue Structure and Product Strategy - In 2023, rice products accounted for 79% of total revenue, but this share decreased to 67% in the first half of 2025 due to the company's investment in other product categories [2] - The company has focused on enhancing its mid-to-high-end rice product offerings, leading to a 21% year-on-year revenue growth in rice business and a significant 106% increase in gross profit in the first half of 2025 [2] - Corn has emerged as a new staple choice for consumers, with its revenue contribution rising from 3% in 2023 to 14% in the first half of 2025 [2] - Other product segments, including grains, beans, and dried goods, each contributed approximately 9% to revenue in the first half of 2025 [2] Group 3: Channel Strategy and Performance - The company has seen positive results from its multi-channel strategy, with online sales accounting for 58% of total revenue in 2023, and the share of online self-operated stores increasing [3] - Revenue from modern supermarkets and direct customer channels has risen significantly, from 26% in 2023 to 35% in the first half of 2025, aided by partnerships with chains like Sam's Club [3] - Revenue from the distribution network has remained stable [3]