Investment Rating - The investment rating for the company is "Buy-A" with a target price of 14.27 CNY within six months [5][8]. Core Insights - The company has established a strong market presence in the spicy snack sector, evolving from a single product (spicy strips) to a diversified portfolio including vegetable and bean products, with a projected revenue of 33.7 billion CNY from vegetable products in 2024, accounting for 54% of total revenue [1][3][25]. - The spicy strip industry is experiencing growth, with a market size expected to exceed 700 billion CNY, driven by economic recovery and changing consumer preferences [31][34]. - The company leverages its production capabilities and marketing strategies to maintain its leading position in the spicy strip market, with a focus on product innovation and channel expansion [2][43]. Summary by Sections Company Overview - The company, established in 1999, has grown from a local snack producer to a national leader in spicy snacks, listing on the Hong Kong Stock Exchange in 2022 [14][18]. - The ownership structure is family-based, with the founding family holding approximately 78% of the shares, which enhances decision-making efficiency [22]. Product Matrix and Manufacturing System - The product range includes spicy strips, vegetable snacks, and bean products, with a focus on health-conscious offerings like konjac snacks [23][25]. - The company operates five factories in Henan, utilizing advanced production technologies, including 5G smart production lines, to enhance efficiency and ensure food safety [28][30]. Spicy Strip Market Dynamics - The spicy strip market is characterized by a growing consumer base and evolving taste preferences, with a projected compound annual growth rate of 4.2% from 2020 to 2024 [34][36]. - The company has adopted a differentiated flavor strategy, offering a variety of spicy strip flavors to cater to diverse consumer tastes [2][41]. Financial Projections - Revenue forecasts for 2025, 2026, and 2027 are 75.17 billion CNY, 90.19 billion CNY, and 106.30 billion CNY, respectively, with year-on-year growth rates of 20.0%, 20.0%, and 17.9% [4][9]. - Net profit projections for the same years are 1.408 billion CNY, 1.739 billion CNY, and 2.151 billion CNY, reflecting significant growth potential [9].