Core Viewpoint - Haitong International forecasts that Leshushi (02698) will achieve revenues of $5.5 billion, $6.5 billion, and $7.6 billion for the years 2025-2027, representing year-on-year growth of 21%, 17%, and 17% respectively. Adjusted net profits are expected to be $1.1 billion, $1.3 billion, and $1.5 billion for the same years, with year-on-year growth of 14%, 17%, and 17% respectively. Given Leshushi's leading position in the African hygiene products market and the structural opportunities from Africa's demographic dividend and increasing penetration rates, a 25x PE ratio for 2026 is suggested, corresponding to a reasonable market value of HKD 25.1 billion and a target price of HKD 40.5 [1][2]. Company Overview - Leshushi is a multinational hygiene products company focused on emerging markets such as Africa, Latin America, and Central Asia, primarily engaged in the development, manufacturing, and sales of baby diapers, pull-ups, sanitary napkins, and wet wipes. According to Frost & Sullivan data, the company ranks first in Africa's baby diaper and sanitary napkin markets by sales volume for 2024, with market shares of 20.3% and 15.6% respectively. By revenue, it ranks second in both markets, with shares of 17.2% and 11.9% respectively [2]. Growth Drivers - The combination of Africa's population growth and accelerated urbanization, along with the low penetration rates of baby and female hygiene products, drives significant industry growth potential. Leshushi demonstrates leading growth momentum in both the baby diaper and sanitary napkin markets, supported by a product matrix that covers premium, mid-range, and mass-market segments [3]. Core Competencies - Differentiated brand strategy with a strong brand matrix: Since launching its core brand Softcare in Ghana in 2009, the company has expanded to include brands such as Maya, Veesper, Cuettie, and Clincleer, creating a comprehensive brand matrix covering four core categories. As of April 2025, the company has over 340 SKUs across these categories [4]. - Localized production and supply chain management: The company initiated local production in Ghana in 2018 and has established eight factories and 51 production lines across eight African countries by April 2025, making it the hygiene products company with the most local factories in Africa. The "locally produced, locally sold" model significantly shortens the sales chain, reduces costs, and enhances consumer engagement [4]. - Extensive multi-channel sales network: As of April 2025, the sales network has expanded to over 30 countries in Africa, Latin America, and Central Asia, with 18 sales branches in 12 countries serving over 2,800 customers. The network covers all administrative regions in key operating countries, reaching over 80% of the local population [4]. Future Growth Strategy - Regional expansion: Leshushi aims to replicate its successful "African model" in Latin America and other emerging markets with similar demographics and consumption patterns, creating a sustainable second growth curve [5]. - Category expansion: The company plans to leverage existing channel networks and consumer insights to expand into health care and hygiene-related products, while also considering strategic acquisitions to rapidly gain brand assets and market entry [5].
海通国际：首予乐舒适 “优于大市”评级 目标价40.5港元