BAT(US:BTI) Tianfeng Securities·2025-06-09 00:30Investment Rating - Industry rating is maintained at "Outperform" [6] Core Insights - British American Tobacco focuses on expanding the Glo product line in the second half of the year, with expectations for revenue growth driven by innovative products [1] - For the fiscal year 2025, British American Tobacco anticipates revenue growth of 1-2% and adjusted operating profit growth of 1.5%-2.5%, indicating strong resilience [1] - The U.S. market is expected to recover revenue and profit growth due to enhanced delivery capabilities of combustible tobacco products and the Velo Plus brand [1] - Despite a 9% year-on-year decline in industry sales, British American Tobacco has solidified its market share in the U.S. [1] - The electronic cigarette export value from China remained stable in April 2025, with a total export value of $8.77 billion, showing a year-on-year decline of 1.84% [4] Summary by Sections Emerging Tobacco Products - Velo is the fastest-growing product in the oral tobacco category, with a market share increase of 270 basis points to 14.3% and a modern oral tobacco share increase of 350 basis points to 29.7% [2] - The U.S. market saw a total volume share increase of 550 basis points to 11.9%, driven by high trial and retention rates [2] - Glo's market share decreased by 90 basis points due to intense competition in Japan, but the launch of Glo Hilo in Serbia showed promising results [2] E-Cigarettes - Vuse maintains its global value share leadership, but the U.S. and Canadian markets are affected by illegal products [3] - The company expects a double-digit revenue decline in the first half of the year, with improvements anticipated in the second half due to the phased launch of the Vuse Ultra product [3] - Long-term goals include revenue growth of 3-5% and adjusted operating profit growth of 4-6% by 2026 [3] Market Performance - The top five export destinations for Chinese e-cigarettes accounted for 65.96% of total exports, with the U.S. being the largest market at $3.34 billion [4] - The UAE market has shown significant growth, surpassing Malaysia to become the fifth-largest destination for Chinese e-cigarette exports [4] Investment Opportunities - Suggested companies to focus on include Smoore International, Yinghe Technology, and others in the vaping supply chain [5]