Core Viewpoint - Haitan Flavor Industry Co., Ltd. is preparing for an IPO on the Hong Kong Stock Exchange, aiming to enhance its international presence and capitalize on the growing demand for condiments both domestically and globally [2][14]. Company Core Advantages - The company boasts a rich history of over 400 years as a "Chinese Time-honored Brand," leading in brand value within the industry. It ranks first in soy sauce, sauces, oyster sauce, and vinegar categories according to the C-BPI 2024 brand index [3]. - Haitan has developed a comprehensive product matrix with over 1,000 SKUs, covering household consumption, catering customization, and food processing [4]. Production Capacity and Smart Manufacturing - Haitan operates four major production bases across China, achieving a production capacity exceeding 4.5 million tons in 2024, maintaining its industry leadership. Its factory in Guangdong has been recognized as a "Lighthouse Factory" by the World Economic Forum, showcasing advanced manufacturing capabilities [5]. Channel Network and Digital Capabilities - The company has a nationwide sales network reaching nearly 100% of city-level and about 90% of county-level markets, with over 6,700 distributors. Online sales have surged, with a 39.78% year-on-year increase in 2024, reaching 1.243 billion yuan [6]. Industry Development Prospects - The condiment market in China is projected to grow from 479.3 billion yuan in 2023 to 699.8 billion yuan by 2029, with a compound annual growth rate (CAGR) of 7%. This growth is driven by the recovery of the catering industry, consumption upgrades, and the development of the food processing sector [8]. - The global condiment market is expected to increase from 2.1 trillion yuan in 2023 to nearly 2.9 trillion yuan by 2029, with a CAGR of 6.2% [9]. Consumption Upgrade and Health Trends - The Chinese condiment market is experiencing a shift towards higher quality and differentiated products, with increasing demand for organic and health-oriented options. Haitan is responding by launching zero-additive and organic products [13]. Industry Consolidation and Concentration - The Chinese condiment industry has a low market concentration, with the top five companies holding only 10.9% of the market share, compared to 24.0% in the U.S. and 28.5% in Japan. Haitan's IPO is a strategic move to enhance its global brand image and attract international capital [14]. Competitive Advantages and Barriers - Haitan holds a 17% market share in the Chinese condiment industry, significantly outperforming competitors like Lee Kum Kee and Qianhe. The company is projected to achieve revenues of 26.901 billion yuan and a net profit of 6.344 billion yuan in 2024 [15]. R&D Investment and Technical Barriers - In 2024, Haitan plans to invest 840 million yuan in R&D, focusing on salt reduction and organic technology, with over 500 authorized patents in fermentation technology and brewing equipment [16]. Cost Control and Supply Chain Resilience - Haitan's cost advantages stem from large-scale procurement and smart manufacturing, resulting in a gross margin that is 5-8 percentage points higher than the industry average. The company has also implemented strategies to mitigate raw material price fluctuations [17]. Capital Strength and Globalization Layout - The upcoming IPO is expected to enhance Haitan's international financing capabilities, with plans to expand into Southeast Asia and North America. The company aims to increase its overseas revenue share from less than 5% to 15% within three years [18].

Core Viewpoint - Li Ziyuan's core product, dairy beverages, has faced stagnation in growth for three consecutive years, leading to a revenue plateau around 1.4 billion yuan [1][2][3] Group 1: Company Performance - Li Ziyuan's revenue from 2022 to 2024 remained stagnant at approximately 1.4 billion yuan, with figures of 1.404 billion, 1.412 billion, and 1.415 billion respectively [2][3] - The net profit has also failed to surpass the 2021 peak of 262 million yuan, with figures of 222 million, 237 million, and 224 million for the respective years [2][3] - The company's reliance on dairy beverages has been over 95% from 2017 to 2024, indicating a lack of diversification [3] Group 2: Market Challenges - The dairy beverage market is highly competitive, with Li Ziyuan's core product, sweet milk, facing declining sales due to changing consumer preferences towards healthier options [3][4] - Sales growth for dairy beverages from 2022 to 2024 showed a decline of 8.06%, 1.67%, and a slight increase of 0.41%, indicating a weak market performance [3] Group 3: Product Diversification Efforts - Li Ziyuan has attempted to diversify its product offerings, including fruit and vegetable beverages, protein drinks, and entering the vitamin water market in 2024 [1][5] - Despite launching numerous new products, the impact on overall sales has been minimal, with the second-largest category, flavored dairy beverages, only generating over 10 million yuan in sales despite a 61.95% increase in volume [6] Group 4: Strategic Focus - The company plans to focus on milk powder and dairy product production and sales by 2025, with a project to process 1,000 tons of raw milk daily [7] - The shift towards milk powder may provide strategic transformation opportunities, but success will depend on various factors, including supply chain management and brand image [7]

Core Viewpoint - Liu Liu Mei is making a second attempt to go public, this time targeting the Hong Kong Stock Exchange after a failed attempt in 2019, with significant growth in revenue and profit over the past six years [1][2]. Group 1: Financial Performance - In 2018, Liu Liu Mei's revenue was 873 million RMB with a net profit of 56.03 million RMB. By 2024, revenue has nearly doubled to 1.616 billion RMB, and net profit increased to 148 million RMB, approximately 2.6 times the original [1][2]. - Liu Liu Mei is recognized as the leading brand in the fruit snack segment in China, with a revenue scale that positions it as a mid-to-large company in the snack industry [2][3]. Group 2: Product Line Adjustments - The company has streamlined its product offerings, focusing on three core product lines: traditional dried plums, jelly products represented by plum jelly, and nutrient-rich prune products [6][9]. - The revenue structure in 2024 shows a significant shift: dried plums generated 974 million RMB (60.3%), prunes 223 million RMB (13.8%), and jelly products 410 million RMB (25.4%) [9][11]. Group 3: Jelly Product Line Growth - The jelly product line, introduced in 2019, has become a major revenue contributor, generating over 400 million RMB in 2024, accounting for more than a quarter of total revenue [11][13]. - The jelly product line has shown a remarkable growth trajectory, with revenues increasing from 230 million RMB in 2022 to 410 million RMB in 2024 [14][16]. Group 4: Market Position and Strategy - Liu Liu Mei has established itself as the market leader in the konjac jelly segment in China, benefiting from the health trend and the growing popularity of low-GI snacks [20][21]. - The company has expanded its distribution channels significantly, with key clients contributing 422 million RMB in revenue in 2024, a substantial increase from 80 million RMB in 2023 [23][24]. Group 5: Future Growth Potential - The company is exploring new flavor profiles for its dried plum snacks and aims to leverage the jelly product line as a second growth curve, potentially reaching a revenue level of 1 billion RMB [26]. - Despite the growth in the jelly segment, the overall market for dried plums and prunes remains relatively small, indicating that future growth may heavily rely on the jelly product line [26].

根据24 年年报，下调25 年收入、毛利率，上调25 年费用率。公司2025-2027 年每股收益调整为0.42、 0.51、0.58 元（原预测25 年为0.75 元）。结合可比公司，我们认为目前公司的合理估值水平为2025 年 的40 倍市盈率，对应目标价为16.80元，维持买入评级。 风险提示 To B 业务进展较慢风险、饮料业务竞争激烈风险、水果罐头动销不及预期风险、新工厂产能利用率不 及预期风险、原材料价格大幅上涨风险。 消费疲软，收入略承压。分产品看，椰子汁饮料收入9.64 亿元（同比-3.7%），消费疲软导致增长乏 力；水果罐头收入6.27 亿元（同比-11.5%），其中黄桃、橘子罐头收入分别为2.80 亿元和1.79 亿元，同 比均个位数下滑。零食渠道贡献收入1.15亿元（占比18.3%）。分区域看，华中、华东、西南三大核心 区域收入分别同比-11%/+20%/-5%，华东增长势头良好，此外华南地区在低基数下展现较快增速。截至 24Q4 末，公司经销商数量为2236 家，较H1 末增加294 家，多区域增加渠道合作及产品铺货。 零食占比提升，净利率下滑。2024 年，公司毛利率为34.00%（ ...

Investment Rating - The report assigns a "Buy" rating for the company with a target price of 26 CNY, based on a relative valuation method, corresponding to a PE of 25X for 2025 [6]. Core Viewpoints - The company is a leading player in functional sugars, with accelerated capacity expansion driving high growth. It has established itself as a top supplier of functional ingredients in China, focusing on prebiotics, dietary fibers, and healthy sweeteners. The company is expected to achieve a revenue CAGR of 22% and a net profit CAGR of 25% from 2019 to 2024 [1][3]. Summary by Sections 1. Functional Sugar Leadership and Capacity Expansion - The company has diversified its product matrix to meet health demands, with a focus on prebiotics, dietary fibers, and healthy sweeteners. Its revenue from prebiotics, dietary fibers, and healthy sweeteners accounted for 29%, 54%, and 13% respectively in Q1-Q3 2024 [18][19]. - The company has a stable shareholding structure and experienced management team, with the chairman holding 47.36% of shares, ensuring strong operational control [21][24]. - The company maintains a strong profitability position within the industry, with new production lines expected to enhance profit elasticity in 2025 [26]. 2. Emerging Industry Potential and Competitive Barriers - The dietary fiber industry is experiencing robust growth, with global and Chinese revenues reaching 514 million and 129 million USD in 2023, respectively, and projected to grow significantly by 2030 [2][34]. - The company is positioned to benefit from the high technical barriers in the high-end product segment, particularly in resistant dextrin, which has a market share of 18% in China [40][46]. 3. Performance Growth from Capacity Expansion and Stable Demand - The company anticipates revenue growth from three main areas: increased proportion of high-margin products, continuous capacity expansion, and strong customer stickiness [3][32]. - The company expects a revenue increase of 33% in 2024, reaching 1.15 billion CNY, with net profit projected to grow by 30% to 250 million CNY [3][5]. 4. Financial Forecast - The company’s financial projections indicate a revenue increase to 1.15 billion CNY in 2024, with net profit reaching 250 million CNY, and further growth expected in subsequent years [5][26].

Investment Rating - The report maintains a "Buy" rating for Nongfu Spring (9633.HK) with a target price of HKD 43.35, based on a current price of HKD 34.10 [1]. Core Insights - The report highlights that the bottled water segment is under short-term pressure, but recovery is expected as the peak season approaches. The company is also seeing growth in its tea beverage segment [1][8]. - The company reported a revenue of CNY 428.96 billion for 2024, a year-on-year increase of 0.54%, and a net profit of CNY 121.23 billion, up 0.36% year-on-year. The second half of 2024 saw a revenue decline of 6.7% [8][11]. - The report emphasizes the company's strong market position in bottled water and the ongoing high growth trend in its tea beverage business, supported by innovative product offerings and effective marketing strategies [8][9]. Financial Summary - **Revenue Forecast**: Expected revenues for 2025, 2026, and 2027 are CNY 493.18 billion, CNY 553.39 billion, and CNY 604.03 billion, respectively, with growth rates of 14.97%, 12.21%, and 9.15% [3][11]. - **Net Profit Forecast**: Projected net profits for the same years are CNY 141.25 billion, CNY 161.30 billion, and CNY 179.16 billion, with growth rates of 16.51%, 14.19%, and 11.07% [3][11]. - **Earnings Per Share (EPS)**: Expected EPS for 2025, 2026, and 2027 are CNY 1.26, CNY 1.43, and CNY 1.59, respectively [3][11]. - **Return on Equity (ROE)**: The ROE is projected to be 37.23% in 2025, 36.34% in 2026, and 34.75% in 2027 [3][11]. - **Price-to-Earnings (PE) Ratio**: The PE ratio is expected to decrease from 31.63 in 2024 to 21.41 in 2027 [3][11]. Business Segment Performance - **Bottled Water**: Revenue for 2024 was CNY 159.52 billion, down 21.3% year-on-year. The volume is expected to recover with a projected growth of 18% in 2025 [11][12]. - **Tea Beverages**: Revenue increased by 32.3% to CNY 167.45 billion in 2024, with continued strong growth expected [11][12]. - **Functional Beverages**: Revenue for 2024 was CNY 40.85 billion, with a growth forecast of 15.6% for 2025 [11][12]. - **Juice Beverages**: Revenue was CNY 11.82 billion in 2024, with a decline expected in the coming years [11][12]. Market Position and Strategy - The report notes that the company is well-positioned in the bottled water market and is expected to recover market share as the impact of recent controversies diminishes. The tea beverage segment continues to thrive, particularly in the no-sugar category [8][9][10]. - The company is focusing on product innovation and expanding its product matrix to align with health trends, which is expected to support long-term growth [8][9].

Summary of Conference Call Notes Industry Overview - The conference call primarily discusses the Chinese liquor and beverage industry, particularly focusing on the trends observed during the Spring Sugar and Wine Fair 2025 [1] Key Points and Arguments Liquor Industry Trends - The white liquor sector shows signs of a decline in the popularity of sauce-flavored liquor, with a noticeable decrease in the number of participating brands, especially private label products [2] - Many small sauce liquor manufacturers have not produced any products this year, with the initial payment for new orders dropping significantly from 100,000 yuan to 20,000 yuan, indicating increased market competition and quality risks [2][3] - The market share of clear-flavored liquor, represented by Fenjiu, has significantly increased among small brands, reflecting a growing consumer acceptance of this type of liquor [2] Beer Industry Developments - The beer sector is experiencing a trend towards premiumization, with mainstream beer prices rising to between 6 and 8 yuan, allowing small manufacturers to survive in the 4 to 6 yuan price range [3] - Small breweries are focusing on flavor differentiation rather than production techniques, with popular products including fruit-flavored beers and the Xinyang Maojian series [4] Beverage Industry Innovations - Beverage brands are avoiding standard 500ml bottle designs by introducing non-standard sizes (e.g., 480ml, 530ml) to prevent direct price comparisons, showcasing a trend towards product differentiation [5] - The market is seeing a surge in new flavors and types of beverages, indicating ongoing innovation and diversification [5] Challenges for Small Enterprises - Small companies struggle to compete with large enterprises on cost due to the high prices of standard products like iced tea and cola [6] - To survive, small businesses are focusing on product differentiation, particularly in health-oriented products like coconut water and healthy juices, although they face challenges due to a lack of industry standards [6] Sales Model Transformation - The development of technology is significantly changing the sales model in the liquor industry, with a shift from traditional regional pricing discussions to focusing on distribution channels and private traffic monetization [7] - Online live streaming and AI tools are becoming new sales methods, with many brands employing influencers for product promotion [7] Distributor Feedback - Distributors reported that the Spring Sugar and Wine Fair met expectations, with stable demand for brands like Fenjiu and Jianshiyuan during the Spring Festival, and a better-than-expected recovery in post-holiday banquet demand [8] - However, business activities have not fully recovered, leading to cautious purchasing intentions among distributors [8] Supply-Side Strategies - Major brands like Moutai and Wuliangye are actively pursuing long-term strategic goals and maintaining high price standards, with Wuliangye's price recovering from 870-880 yuan to 930-940 yuan [9][10] - These companies are participating in reforms to maintain market positions and improve channel value distribution [10] Future Demand Expectations - The focus on business activities is crucial, as inventory levels are generally low, and distributors are hesitant to make large purchases during the off-season [11] - Observations of the economic performance in the second quarter are necessary, with companies like Fenjiu and Gujing showing stable growth strategies despite some macroeconomic conflicts [11]