Investment Rating - The report maintains a "Hold" rating for the company with a target price of HKD 1.15 per share, indicating a potential upside of 17.3% from the current price of HKD 0.98 [6][17]. Core Insights - The company has experienced significant operational pressure in recent years, but it has managed to reduce losses substantially in the first half of 2025, with a net loss of HKD 0.84 billion compared to HKD 2.72 billion in the same period last year. This improvement is attributed to lower raw material costs and reduced asset impairment losses [8][6]. - The company has initiated an internal partnership system aimed at stabilizing and expanding its store network, with plans to add 60 partnership stores by the end of 2026. Currently, there are 763 stores under the main brand, with a slight increase in the number of stores compared to the end of 2024 [4][11]. - The "Couch" brand is under significant pressure, currently in a phase of store closures, with a total of 174 stores as of the first half of 2025. The brand's same-store sales have declined by 14.0% [5][12]. Summary by Sections Financial Performance - For the first half of 2025, the company reported total revenue of HKD 19.42 billion, a year-on-year decrease of 18.88%. The main brand contributed HKD 11.35 billion, down 13.5%, while the "Couch" brand generated HKD 7.45 billion, down 25.8% [8][6]. - The company expects net profits for 2025 to be -HKD 2.42 billion, improving to -HKD 0.21 billion in 2026, and turning positive with HKD 0.11 billion in 2027 [6][17]. Store Network and Strategy - As of the first half of 2025, the company operates 763 stores, with a breakdown of 42.6% in first-tier cities, 41.0% in second-tier cities, and 16.0% in lower-tier cities. The store count has stabilized, with a net increase of 3 stores compared to the end of 2024 [4][10]. - The company has implemented a "dual-point" model for the "Couch" brand, which has shown promising results, with a 49% increase in performance compared to traditional stores [12][5]. Cost Management - The company has seen a reduction in raw material costs by 22.5% to HKD 6.41 billion, contributing to an improved cost-to-revenue ratio of 33.02% [8][6]. - Employee costs have decreased by 18.1% to HKD 6.67 billion, with a reduction in workforce from 24,606 to 17,930 employees [8][6].
呷哺呷哺（00520）：亏损大幅收窄，期待经营调整效果