Core Viewpoint - Guosen Securities maintains an "outperform" rating for Jiangnan Buyi (03306) with a target price of HKD 21.8-25.8, corresponding to a FY2026 PE of 11-13x, highlighting the opportunity for investment in undervalued, high-dividend leaders [1] Financial Performance - The company reported a revenue of HKD 3.376 billion for the first half of FY2026, representing a year-on-year growth of 7.0%, demonstrating resilience amid overall industry pressure [1] - Net profit for the same period increased by 11.9% to HKD 676 million, with a net profit margin rising from 19.1% to 20.0% [1] - Operating cash flow reached HKD 996 million, up 21.1% year-on-year, supporting the company's ability to maintain high dividend payouts [1] Dividend Policy - The company declared an interim dividend of HKD 0.52 per share, with a plan to maintain a 75% payout ratio for the full fiscal year 2026 [1] Channel Performance - Online revenue grew by 25.1% to HKD 750 million, accounting for 22.3% of total revenue, with a gross margin increase of 1.6 percentage points to 65.8% [2] - Offline revenue saw a modest increase of 2.7%, with self-operated channels growing by 5.7% while distributor channels remained flat [2] - Comparable same-store sales declined by 2.2%, influenced by a warm winter and the timing of the Spring Festival [2] Brand Performance - The main brand, JNBY, accounted for 55.1% of total revenue, growing by 5.7% with a gross margin increase of 1.8 percentage points to 69.4% [2] - Emerging brands showed a revenue share of 7.0%, with a growth of 22.4%, although their gross margin decreased by 3.6 percentage points to 48.8% [2]