Core Viewpoint - The establishment of a dedicated trademark processing window in the Nanning area of the Guangxi Free Trade Zone marks a significant step in developing a comprehensive intellectual property service system, enhancing brand development and protection for local businesses [1] Group 1: Trademark Processing Window - The trademark processing window is the first of its kind in the Guangxi Free Trade Zone, located in the Wuxiang Headquarters Building, and has been approved to operate since December 31, 2025 [1] - It offers a full range of services including trademark registration, changes, renewals, and pledge registration, integrating deeply with the Nanning Intellectual Property Protection Center [1] Group 2: Service Model and Benefits - The window aims to break down business barriers by creating a "trademark + patent + rights protection + finance" full-chain service model, allowing companies to enjoy one-stop services without leaving the zone [1] - It provides additional services such as trademark layout guidance and risk warnings, along with core services like patent pre-examination, rapid rights protection, overseas dispute response, and pledge financing [1] Group 3: Industry Focus and Support - The window will leverage the service advantages in key industries such as new energy, new materials, and biomedicine to conduct targeted brand cultivation for specific industries [1] - It aims to assist companies in deepening their market presence in ASEAN by offering international trademark layout planning, overseas brand risk warnings, and cross-border rights protection support [1]

Core Insights - The U.S. Patent and Trademark Office (USPTO) has significantly improved its trademark examination performance for FY 2025, indicating a more predictable and efficient process for cross-border e-commerce sellers focusing on the U.S. market [2][5]. Group 1: Performance Metrics - The average time to first action for trademark applications has been reduced to 5.6 months, compared to the goal of 6.7 months [4][5]. - The average total processing time for trademark applications has decreased to 11.7 months, against a target of 13 months [4][5]. - The backlog of unexamined trademark categories has dropped to 346,378, a reduction of over 90,000 from the previous year [5]. Group 2: Implications for Cross-Border E-Commerce Sellers - The trademark examination cycle is becoming more predictable, allowing sellers to proactively incorporate U.S. trademarks into their product selection and branding strategies [6][7]. - It is advisable for sellers to secure core brand names early, as the increasing number of applications makes the trademark database more crowded, reducing the risk of rejections and disputes [7]. - The U.S. market should no longer be viewed as a "step behind" in trademark registration; sellers can plan and file U.S. trademarks in sync with their EU and UK trademarks to expedite brand protection [7]. - A multi-faceted approach to trademark protection is recommended, combining word marks with graphic (logo) trademarks and considering design patents and copyright registrations for comprehensive product protection [9].

Investment Rating - The report does not provide a specific investment rating for the company [1] Core Insights - The company has shown a revenue of 1.306 billion yuan for the first three quarters of 2025, a slight decrease of 0.7% year-on-year, while the net profit attributable to the parent company increased by 3.8% to 157 million yuan [1] - The third quarter revenue was 418 million yuan, reflecting a significant decline of 16.98% year-on-year, with a net profit of 55 million yuan, down 2.2% [1] - The company is expected to see improved performance in the second half of 2025 due to stable growth from quality customers and the anticipated ramp-up of overseas production capacity [2] Summary by Sections Financial Performance - For Q3 2025, the gross profit margin was 22.6%, an increase of 1.9 percentage points year-on-year, and the net profit margin was 13.1%, up by 2.0 percentage points [3] - The company’s operating cash flow for the period was 74 million yuan, showing a slight increase from the previous year [3] - The forecast for net profit attributable to the parent company for 2025-2027 is 234 million, 283 million, and 335 million yuan respectively, with corresponding PE ratios of 27.5X, 22.8X, and 19.3X [3] Business Strategy - The company plans to enhance its brand portfolio by acquiring 100% equity of a brand called "Gao Ye Jia," which includes popular products in the pet food sector [2] - The brand "Xu Cui Hua" achieved significant sales during the 618 shopping festival, ranking first in the cat litter category on Tmall, indicating strong market presence [2] Market Position - The company holds a leading position in the industry, accounting for nearly 40% of the total export value of similar products in China [2] - The company is strategically expanding its production capacity in Cambodia, which is expected to contribute positively to revenue growth in the upcoming quarters [2]

Core Viewpoint - The company reported a decline in revenue and net profit for 2024, primarily due to rising gold prices leading to increased store closures among franchisees, but maintains a high dividend policy [1][3]. Group 1: Financial Performance - For 2024, the company recorded revenue of 13.89 billion yuan, a year-on-year decrease of 14.7%, and a net profit attributable to shareholders of 1.01 billion yuan, down 23.25% year-on-year, slightly below expectations [1]. - In Q1 2025, revenue was 2.67 billion yuan, a significant year-on-year decline of 47.3%, with a net profit of 250 million yuan, down 26.1% year-on-year [1]. - The company plans to distribute a cash dividend of 6.5 yuan per 10 shares (tax included), with an annual total dividend of 0.95 yuan per share (tax included), resulting in a dividend yield of approximately 7% [1]. Group 2: Market Strategy - The company is enhancing its brand matrix to adapt to current consumer trends and capture market share, with four main brands focusing on different segments [2]. - The main brand "Zhou Dazheng" is improving store profitability through adjustments in store image and product structure [2]. - "Zhou Dazheng Classic" focuses on gold products blending Eastern culture with modern fashion, while "Zhou Dazheng National Treasure" targets high-end channels [2]. - "Zhuanzhuge" is positioned as a light asset, high-margin brand focusing on cultural jewelry products, with over 60 stores opened [2]. Group 3: Revenue Channels and Profitability - In Q1 2025, franchise business revenue was 1.58 billion yuan, down 58.6%, with a revenue share decrease of 16.3 percentage points to 59.3%, attributed to increased store closures [3]. - Offline self-operated and e-commerce channel revenues were 527 million yuan and 534 million yuan, down 16.3% and 6.7% year-on-year, respectively [3]. - The gross profit margin for Q1 2025 was 26.2%, an increase of 10.6 percentage points year-on-year, benefiting from rising gold prices [3]. - The net profit margin for Q1 2025 was 9.4%, up 2.7 percentage points year-on-year [3]. Group 4: Profit Forecast and Valuation - The company has adjusted its net profit forecasts for 2025 and 2026 down by 12% and 11% to 1.1 billion yuan and 1.23 billion yuan, respectively, and introduced a 2027 forecast of 1.38 billion yuan, with growth rates of 9.3%, 11.2%, and 12.7% [4]. - The average PE ratio for comparable companies in 2025 is expected to be 14 times, reflecting improved consumer demand in the gold and jewelry sector [4]. - The company is assigned a 2025 PE of 17 times, leading to a target price of 17.2 yuan, up from a previous 14.8 yuan [4].

Investment Rating - The report maintains a "Buy" rating for the company [7] Core Views - The company reported a revenue of 13.89 billion RMB for 2024, a decrease of 14.7% year-on-year, and a net profit attributable to shareholders of 1.01 billion RMB, down 23.25% year-on-year, slightly below expectations [1][4] - The company plans to distribute a cash dividend of 6.5 RMB per 10 shares (including tax), resulting in an annual dividend of 0.95 RMB per share, corresponding to a dividend yield of approximately 7% [1] - The first quarter of 2025 saw a revenue of 2.67 billion RMB, a significant decline of 47.3% year-on-year, with a net profit of 250 million RMB, down 26.1% year-on-year [1] Summary by Sections Performance Overview - The company experienced a decline in revenue and net profit due to rising gold prices affecting franchisee store closures [1][3] - The first quarter of 2025 showed a gross margin of 26.2%, an increase of 10.6 percentage points year-on-year, benefiting from rising gold prices [3] Brand Strategy - The company is enhancing its brand matrix to adapt to current consumer trends and capture market share [2] - The main brand "Zhou Dasheng" is improving store profitability through adjustments in store image and product structure [2] Revenue Channels - Franchise business revenue decreased by 58.6% year-on-year, accounting for 59.3% of total revenue [3] - Offline self-operated and e-commerce channel revenues were 527 million RMB and 534 million RMB, down 16.3% and 6.7% year-on-year, respectively [3] Profit Forecast and Valuation - The company’s net profit forecasts for 2025 and 2026 have been revised down by 12% and 11% to 1.10 billion RMB and 1.23 billion RMB, respectively [4] - The target price is set at 17.20 RMB, based on a 17 times PE ratio for 2025 [4][8]