Investment Rating - The report assigns a "Buy" rating for the company [5] Core Views - The company has established a strong flavor advantage in its product categories and is leveraging channel innovations to drive growth. The expansion into flavor nuts and snacks has led to a stable growth trajectory, with a projected revenue of 2.26 billion yuan in 2024, reflecting a CAGR of 20.4% over the past three years [1][3][18] - The company is focusing on enhancing its product barriers through innovative flavors and processing techniques, which have created a competitive edge in the market. The product line has expanded significantly, with the proportion of products outside the "old three" increasing from 32.6% in 2020 to 50.9% in 2024 [2][11][17] - The company is actively expanding its distribution channels, particularly in emerging markets and overseas, while also refining its traditional retail strategies. This includes a shift to a direct operation model for traditional supermarkets starting in 2024 [2][18] Summary by Sections Company Overview - The company has a concentrated ownership structure with the founder holding 56.24% of the shares, ensuring strategic direction and stability in operations [21][24] Product Development - The company has built a robust product barrier through continuous innovation in flavors and processing methods, resulting in a strong competitive position in the snack food industry. The focus on flavor innovation has led to the successful introduction of various new products [2][27][28] Market and Channel Strategy - The company is capitalizing on the channel transformation in the retail industry, particularly through the expansion of bulk snack stores and membership stores. The company is also exploring international markets, particularly in Southeast Asia, where there is a growing demand for flavored nuts [2][18] Financial Projections - The company is expected to achieve revenues of 2.33 billion yuan in 2025, with a projected growth rate of 3.0% year-on-year. The net profit is forecasted to be 328 million yuan, reflecting a decline of 12.9% year-on-year due to cost pressures [3][4]

Group 1: Product Development and Strategy - The company focuses on high-quality canned fruit products, emphasizing portable, casual, and diverse ingredient small-packaged cans. Recently, it launched reduced-sugar and juice fruit canned products to meet varying consumer demands [2][3] - Coconut water, known for its natural electrolytes, remains a key product, with recent brand updates and the introduction of new products like coconut fruit water and coconut water beverages to expand its market presence [2][3] Group 2: Sales Channels and Revenue - In Q1 2025, the company achieved revenue of 46.4462 million yuan from the snack specialty channel, indicating a commitment to diversifying sales channels and enhancing product development for higher value-added offerings [3] - The company is adjusting the prices of its coconut juice products due to rising raw material costs, with price increases ranging from 1% to 8% and some regional price decreases between 1% and 5% [3][4] Group 3: Cost and Procurement - The company sources fruit primarily from Shandong and Hubei, with a significant drop in procurement prices for yellow peaches by over 30% year-on-year due to a bountiful harvest, while orange prices have seen some increases [4] - Coconut raw materials are mainly sourced from Southeast Asia, with procurement prices experiencing upward pressure due to supply and demand factors [4] Group 4: Investment and Expansion - The company plans to invest up to 3.39756 trillion Indonesian rupiah (approximately 21 million USD) in a coconut processing project in Indonesia, aimed at enhancing its upstream supply chain and product offerings [4] - The project is expected to produce coconut-related products, including fresh coconut juice and coconut water, for both local and export markets [4] Group 5: Corporate Governance - Currently, the company has not implemented an equity incentive plan [4] - During the investor relations activity, there were no disclosures of undisclosed significant information, ensuring compliance with regulations [4]

Core Viewpoint - The gold and jewelry market is undergoing significant changes due to persistently high gold prices, leading to shifts in consumer behavior and market dynamics [4][6][12]. Group 1: Market Trends - The market is witnessing a trend towards lower-priced products, with a notable decline in the sales of heavier gold items, while lighter gold bars (10g to 30g) are gaining popularity among consumers [6][11]. - Retailers are adjusting their product offerings, emphasizing lighter and higher-value items, such as silver, pearls, jade, and platinum, which were previously considered secondary products [6][10]. - The introduction of innovative products, like the collaboration between brands and local cultural elements, reflects the industry's shift towards lightweight and high-value offerings [6][10]. Group 2: Channel Restructuring - The industry is experiencing a phenomenon of store closures, particularly in rural areas, as consumer spending power diminishes in smaller towns [7][10]. - The emergence of small-scale "goldsmith" shops caters to consumers seeking unique, handcrafted items, indicating a deeper market segmentation [10][11]. - The market is evolving with a demand for low-cost models, necessitating regulatory oversight to ensure compliance and product quality [10][11]. Group 3: Consumer Behavior and Trust - High gold prices have altered consumer perceptions, leading to a cautious approach towards purchasing, with a decline in demand for larger gold items [11][12]. - The introduction of gold-plated silver products has raised concerns about industry integrity, prompting discussions on ensuring accurate metal content and maintaining consumer trust [11][12]. - There is a generational divide in purchasing preferences, with younger consumers more open to paying for design and craftsmanship, while older consumers prioritize the intrinsic value of gold [11][12]. Group 4: Brand Strategies - The industry is undergoing structural adjustments, with some brands focusing on high-end offerings while others seek differentiation and refined operations [12][14]. - Brands are encouraged to adopt rational store opening strategies, emphasizing quality over quantity in their market presence [14]. - The market's evolution necessitates brands to embrace innovation, uphold integrity, and accurately position their value to thrive in a challenging environment [14].

Core Viewpoint - The company is enhancing its C-end channel diversification and B-end channel synergy after integrating Mengniu Cheese, aiming to enrich its product matrix and strengthen ambient products, which, along with optimized management and improved cost efficiency, is expected to drive a performance turnaround [1]. Investment Highlights - The company is initiating coverage with a "cautious buy" rating, focusing on product innovation and matrix enrichment, accelerating C-end channel diversification, and increasing B-end expansion post-Mengniu integration. Improved management precision is anticipated to significantly enhance net profit margins. EPS is projected to be 0.43, 0.63, and 0.84 yuan for 2025-2027, reflecting year-on-year growth of 94.4%, 45.4%, and 34.6% respectively. Given the expected improvement in net profit margins and substantial growth potential compared to peers, a valuation of 3.1X P/S for 2025 is suggested, corresponding to a fair value of 31.92 yuan per share [2]. Product and Channel Innovation - The company is focusing on its core cheese business, continuously enriching and optimizing its product matrix. C-end cheese sticks are expanding from low-temperature to ambient products, with new product forms being introduced. The B-end operates dual brands with complementary products, leveraging Mengniu's strengths in cream and butter, while the main brand excels in mozzarella, cheese slices, and original cheese. The C-end is diversifying from key accounts to include growth channels like snack wholesale, membership stores, and convenience stores, while the B-end is expanding collaborations with food service and industrial companies. Following Mengniu's acquisition in 2021, the number of retail terminal outlets increased from 600,000 in 2021 to approximately 800,000 in 2022, with further expansion expected [3]. Synergy and Efficiency Enhancement - After integrating Mengniu Cheese, the company is strengthening synergy and mutual empowerment across the entire value chain, from upstream procurement to downstream sales and management. The company is actively promoting refined and precise management operations, with expectations of a noticeable improvement in net profit margins through enhanced sales and management efficiency [3].

Core Viewpoint - The company is focusing on enhancing its product offerings in the canned fruit and coconut water segments while optimizing its sales strategies and cost structures to adapt to market challenges [2][3][5]. Product Development - The company is committed to high-quality canned products, emphasizing portable, casual, and diverse ingredient small-packaged canned fruit products. Recent launches include reduced-sugar versions to cater to varying consumer preferences [2]. - Coconut water, appreciated for its natural electrolytes, is being expanded with new products like coconut fruit water and coconut water beverages to diversify the price range and meet consumer demands [2]. Sales Strategy and Cost Management - In 2025, the company plans to refine its marketing efforts by tailoring sales strategies to different market conditions and optimizing expenditure structures [3]. - The company is addressing raw material costs, with a significant decrease in peach procurement prices by over 30% due to a bountiful harvest, while orange prices have seen a rise due to lower production [3]. Channel Development - The company is enhancing its multi-channel strategy, particularly in the snack specialty channel, achieving revenue of 46.4462 million yuan in Q1 2025 and plans to introduce more personalized and higher-value products [4]. Price Adjustments - The company is adjusting the ex-factory prices of its coconut juice beverages by 1%-8% due to rising raw material costs, while also lowering prices in some regions by 1%-5% [5]. Investment and Expansion - The company plans to invest up to 3,397.56 billion Indonesian rupiah (approximately 21 million USD) in a coconut processing project in Indonesia, aimed at enhancing its supply chain and product offerings [6]. Financial Performance - In Q1 2025, the company reported a main revenue of 449 million yuan, a year-on-year decrease of 18.52%, with a net profit of 34.2533 million yuan, down 58.27% [7]. - The company has a debt ratio of 40.98% and a gross margin of 31.38% [7]. Analyst Ratings - Over the past 90 days, eight institutions have rated the stock, with four buy ratings and four hold ratings, and the average target price set at 16.45 yuan [8].

Group 1: Revenue and Channel Strategy - The company's revenue from shopping centers and Douyin in 2024 is projected to exceed 300 million, with year-on-year growth of approximately 21% and 84% respectively [1] - Online channels are expected to account for about 41% of total revenue in 2024, indicating a high penetration rate for a brand that started offline [1] - The focus on quality management in the Tmall channel is emphasized, rather than relying on paid traffic for growth [1] Group 2: Brand Positioning and Target Audience - The core audience for the brand is women aged 25-35, including refined mothers, middle-class consumers, and new white-collar workers [2] - The brand aims for a youthful image through design and promotion, without abandoning its existing customer base [2] Group 3: Profitability and Market Challenges - The profit margin for the Douyin channel is approximately 7%, with a return rate of about 33% calculated based on shipped goods [2] - The understance brand is in a cultivation phase, facing high costs and low scale, with plans to expand its user base and improve profitability [2] - The strategy includes focusing on the lingerie core business and adapting to changing consumer habits and channel diversification [2]

Group 1: Product Development and Strategy - The company focuses on high-quality canned fruit products, emphasizing portable, casual, and diverse ingredient small-packaged cans to meet varying consumer needs [2][3] - Recent product launches include reduced-sugar canned fruit options and diversified packaging formats, such as fruit cups [2][3] - Coconut water products are positioned to enhance the company's presence in the ready-to-drink market, with new product introductions aimed at broadening the price range [3][4] Group 2: Sales Strategy and Market Adaptation - In 2025, the company plans to refine its marketing strategies based on market conditions, optimizing expenditure and structure for targeted investments [3][4] - The company aims to innovate continuously and strengthen its product matrix to enhance consumer exposure and drive sales [3][4] Group 3: Raw Material Costs and Procurement - The company sources fruit primarily from Shandong and Hubei, with a significant price drop of over 30% for peach raw materials in 2024 due to a bountiful harvest [3][4] - Coconut raw materials are sourced from Southeast Asia, with procurement prices experiencing upward pressure due to supply-demand dynamics [3][4] Group 4: Channel Development and Revenue - In Q1 2025, the company achieved revenue of 46.4462 million yuan from snack specialty channels, indicating a commitment to diversifying sales channels [3][4] - The company plans to enhance product development for higher-value, personalized offerings in the snack specialty sector [4] Group 5: Pricing Adjustments - The company has adjusted the factory prices of certain coconut juice products by approximately 1%-8% due to rising raw material costs, while some regional prices were reduced by 1%-5% [4] Group 6: Investment in Processing Facilities - The company plans to invest up to 3.39756 trillion Indonesian rupiah (approximately 21 million USD) in a coconut processing project in Indonesia, aimed at enhancing its supply chain and product offerings [4]

Investment Rating - The report maintains a "Buy" rating for the company, indicating an expected stock price increase of over 20% relative to the benchmark index within the next 6 to 10 months [7][13]. Core Insights - The company demonstrates strong product iteration capabilities in the cream sector, with new frozen baking products performing well in the Sam's Club channel. The introduction of a new national standard for cream in March 2025 is expected to benefit leading companies like the report's subject as the industry becomes more standardized [5][6]. - The company is diversifying its channels, successfully launching new products in the Sam's Club channel and exploring new retail scenarios in catering and tea drinks. It is also actively developing new channels such as supermarkets and snack wholesale [6]. - The company is effectively managing raw material price fluctuations and focusing on cost efficiency. It has implemented strategies to alleviate cost pressures through bulk purchasing and domestic substitution of key raw materials [6]. Financial Projections - Revenue forecasts for 2025 to 2027 are set at 44.66 billion, 50.49 billion, and 55.39 billion yuan, representing year-on-year growth rates of 16.45%, 13.05%, and 9.7% respectively. Net profit attributable to the parent company is projected to be 3.57 billion, 4.14 billion, and 4.61 billion yuan for the same period, with growth rates of 33.24%, 15.93%, and 11.3% respectively [7][9]. - The earnings per share (EPS) for the next three years are estimated at 2.11, 2.44, and 2.72 yuan, corresponding to price-to-earnings (P/E) ratios of 23, 20, and 18 times based on the current stock price [7][9].

Financial Performance - The company's revenue decreased slightly by 0.3% from RMB 23,586 million in FY23 to RMB 23,511 million in FY24 [6] - Gross margin increased by 100bps from 46.6% in FY23 to 47.6% in FY24 [6] - Operating profit increased by 4.1% from RMB 5,610 million in FY23 to RMB 5,837 million in FY24 [6] - Profit attributable to equity holders of the company increased by 8.6% from RMB 3,990 million in FY23 to RMB 4,336 million in FY24 [6] - Net finance costs decreased by 52.2% from RMB 205 million in FY23 to RMB 98 million in FY24 [6] Segment Performance - Rice crackers revenue decreased by 1.2% year-over-year [11] - Dairy products and beverages revenue increased by 1.3% year-over-year [13] - Snack foods revenue decreased by 2.6% year-over-year [15] Channel Performance - Emerging channels and overseas markets experienced double-digit growth [9] - Traditional & Modern channels experienced low single-digit decline [9] - Snacks specialty retailers accounted for nearly 10% share of the Group's total revenue [42] Expenses and Capital - Operating expenses decreased low single-digit year-over-year [17] - Distribution costs increased low single-digit year-over-year [20] - CAPEX decreased from RMB 635 million in FY23 to RMB 406 million in FY24 [25] Dividends and Share Repurchases - Total dividend and share repurchases decreased by 43% from USD 431 million (approximately RMB 3,080 million) in FY23 to USD 246 million (approximately RMB 1,775 million) in FY24 [27]

Business Strategy - The company will focus on deepening and upgrading existing product categories while cautiously expanding into new ones, particularly in women's and sportswear, which have shown strong growth recently [2][3] - The company plans to continue regional expansion and diversify channels, leveraging successful experiences from the North American market to enhance operations in Europe, which saw a doubling of clothing business in 2024 [4][3] Channel and Market Development - The company aims to strengthen its presence on Amazon while exploring emerging channels like Temu and TikTok, with plans to expand offline channels in 2025 [4][5] - The company has established a robust overseas supply chain in Southeast Asia, with a factory in Vietnam operational since late 2024, to mitigate risks from tariff increases [5][6] Response to Tariff Increases - The company has implemented a tiered pricing strategy to adjust prices based on market competition and product category dynamics, ensuring a balance between brand value and market competitiveness [5][6] - It is actively exploring new markets with lower tariff risks to diversify regional policy risks [6] Logistics Business Growth - The logistics business has developed a mature service system, with new overseas warehouses increasing total area to over 180,000 square meters, significantly improving delivery efficiency [7] - In 2025, the company will continue to enhance smart warehousing and seek strategic partnerships with major industry clients to create a differentiated competitive advantage [7] Marketing Strategy - The marketing strategy for 2025 will focus on optimizing promotional efforts based on data analysis and market insights, aiming for higher efficiency and return on investment [8] Non-Apparel Business Improvement - The company will control the scale of non-apparel business investments while optimizing processes to improve profitability, focusing on core apparel categories for comprehensive expansion [9]