Core Viewpoint - The company, Yum China (09987), demonstrates resilient same-store growth and continuous expansion of its store network, maintaining an upward trend. The firm possesses long-term advantages in scale, brand influence, industry management capabilities, and digital capabilities. The projected net profit for the company from 2025 to 2027 is estimated at $9.2 billion, $9.91 billion, and $10.57 billion, respectively, with corresponding P/E ratios of 19X, 17X, and 16X, maintaining a "Buy" rating [1] Group 1: Strategic Initiatives - The company announced its RGM 3.0 strategy during the Investor Day, focusing on resilience, growth, and competitive moat, driven by a dual strategy of "innovation and efficiency." The development concept involves a "front-end layering and back-end aggregation" approach, utilizing a multi-brand portfolio and diversified product lines to cover a wide range of consumer scenarios and demographics [2] Group 2: Store Expansion - As of Q3 2025, the company has 17,514 stores nationwide, with a net addition of 1,119 stores compared to 2024. The company aims to steadily reach a total of 20,000 stores by 2026, over 25,000 stores by 2028, and strive to exceed 30,000 stores by 2030. In terms of franchise stores, the company plans for 40%-50% of new KFC stores and 20%-30% of new Pizza Hut stores to be franchises by 2025, gradually increasing the franchise ratio in the coming years [3] Group 3: Shareholder Return Plans - By Q3 2025, the company has returned $9.5 billion to shareholders in the first nine months, with an expected total return of approximately $15 billion for the entire year of 2025. Building on the $15 billion returned in 2024, the company targets a total of $30 billion in shareholder returns between 2025 and 2026. Starting in 2027, the company plans to return approximately 100% of its free cash flow, after deducting dividends paid to minority shareholders [4] Group 4: Profit Goals for Brands - KFC aims to add 992 new stores in the first nine months, with a plan to increase the total number of stores to over 17,000 by 2028, targeting an operating profit exceeding RMB 10 billion, making it the first restaurant brand in China to achieve this milestone [5] - Pizza Hut added 298 new stores in the first nine months, with plans to add over 600 new stores annually for the next three years, aiming to surpass 6,000 stores by 2028 and double its operating profit by 2029 compared to 2024 [6] Group 5: Lavazza Coffee Expansion - Lavazza Coffee is optimizing its store model to enhance economic efficiency and is innovating its menu with localized support to drive growth. The company plans to accelerate expansion in first-tier and select second-tier cities over the next three to five years, targeting over 1,000 stores and retail sales of $60 million by 2029 [7]