Investment Rating - The report gives a "Buy" rating for H&H International Holdings, with a target price of HKD 15.78 per share based on a reasonable overall market value of CNY 94.43 billion for 2024 [4][6][14]. Core Insights - The demand for health supplements is expanding, driven by an aging population and increased health awareness among consumers. The online sales channel has become the primary distribution method, benefiting brands like Swisse [2][11][30]. - H&H International has adopted a "1+3" strategy with its Swisse brand, which includes Swisse Core, Swisse Plus+, Little Swisse, and Swisse Me, aiming for comprehensive family health coverage across all age groups [3][39]. - The company's revenue has shown steady growth, increasing from CNY 101 billion in 2018 to CNY 139 billion in 2023, with a CAGR of 6.57% [1][25]. Summary by Sections 1. Multi-Business Development - H&H International operates in three main segments: infant care, adult health, and pet nutrition, with a diversified business strategy [1][18]. - The adult nutrition segment has seen significant growth, with the acquisition of Swisse in 2015 marking its entry into this market [18][19]. - The revenue from adult nutrition has increased its share from 34.55% in 2020 to 44.10% in 2023, while infant care's share has decreased due to lower birth rates [25]. 2. Industry Expansion - The health supplement market in China has grown from CNY 993 billion in 2013 to CNY 3,335 billion in 2023, with a CAGR of 12.88% [2][33]. - Online retail has surpassed traditional channels, with e-commerce accounting for nearly 60% of sales in 2023 [2][35]. - Swisse's market share in the e-commerce sector reached 5.4% in 2023, positioning it as a strong competitor in the industry [2][36]. 3. Adult Nutrition Care: "1+3" Strategy - The "1+3" strategy allows for targeted marketing across different demographics, with Swisse Plus+ focusing on high-end products for mature consumers and Swisse Me appealing to younger audiences [3][39]. - Swisse Core remains the leading revenue contributor, while Swisse Plus+ has shown rapid growth, expected to continue double-digit growth in 2024 [40]. 4. Financial Forecasts and Valuation - Revenue projections for 2024-2026 are CNY 150.59 billion, CNY 161.84 billion, and CNY 175.01 billion, with corresponding net profits of CNY 8.57 billion, CNY 10.88 billion, and CNY 12.95 billion [4][12]. - The report anticipates a 3-year CAGR of 30.55% for EPS, indicating strong growth potential [4][14].
H&H国际控股：“1+3”战略起步，品牌矩阵渐成