Investment Rating - The report maintains a "Buy" rating for the company [1] Core Views - The company is expected to see a long-term growth trajectory despite short-term fluctuations, with a focus on the recovery of its vaping business [1] - The company has demonstrated strong performance in its mature vaping business, with a notable recovery in overall performance [2] - The HNB (Heat-not-Burn) segment is experiencing significant growth, with a projected revenue increase of 476% year-on-year [3] - The emerging medical and beauty vaping business is in the exploratory phase, with high R&D investments impacting short-term performance but offering substantial long-term profit potential [3] - The company is expected to maintain a high dividend yield, reflecting confidence in future growth [4] Summary by Sections Financial Performance - In 2025, the company achieved a revenue of 14.3 billion HKD, a year-on-year increase of 21%, while the net profit attributable to shareholders was 1.06 billion HKD, a decrease of 19% [1] - The adjusted net profit for 2025 was 1.53 billion HKD, reflecting a year-on-year increase of 1.3% [1] - The company plans to distribute a dividend of 0.2 HKD per share for 2025 [1] Business Segments - The vaping business in the US and Europe showed revenue growth of 19% and 2% respectively, while the Chinese market saw a decline of 11% [2] - The company's own brand generated revenue of 2.9 billion HKD, with significant growth in the US and European markets [2] - The HNB segment generated 1.3 billion HKD in revenue, with plans for expansion into key markets like Japan and Poland [3] - The medical and beauty vaping segment is preparing for FDA approval and aims to build small-scale production capabilities [3] Future Projections - Revenue projections for 2026-2028 are 16.91 billion HKD, 19.98 billion HKD, and 23.66 billion HKD, with year-on-year growth rates of 18.64%, 18.13%, and 18.42% respectively [4] - Net profit projections for the same period are 1.65 billion HKD, 2.57 billion HKD, and 3.49 billion HKD, with growth rates of 55.20%, 55.58%, and 35.69% respectively [4] - The expected EPS for 2025-2027 is 0.27 HKD, 0.41 HKD, and 0.56 HKD, with corresponding P/E ratios of 42, 27, and 20 times [4]

Core Viewpoint - Smoore International (06969) experienced a rebound of nearly 7% after a previous drop of over 8%, indicating market volatility and investor interest in the stock [1] Company Summary - Smoore's stock price rose by 6.84% to HKD 12.18, with a trading volume of HKD 315 million [1] - The company is a key supplier in the vaping and heated tobacco sector for British American Tobacco (BAT), which is intensifying its focus on a smoke-free strategy [1] Industry Summary - Guojin Securities reported that British American Tobacco has launched significant promotions for its HNB products, including a 14-day free trial for the Hilo/Hilo Plus devices and discounted prices in Poland [1] - The competition in the HNB industry is becoming increasingly fierce, with Hilo expected to benefit from strong product capabilities and comprehensive marketing channel development [1]

Group 1 - The stock of Smoore International (06969) rebounded nearly 7% after experiencing a drop of over 8% previously, currently trading at HKD 12.18 with a transaction volume of HKD 315 million [1] - Guotai Junan Securities recently reported that British American Tobacco (BAT) has announced a promotional campaign for its Hilo/Hilo Plus devices, offering a 14-day free trial with significant discounts in Poland, indicating an increase in promotional efforts [1] - The heated tobacco (HNB) industry is becoming increasingly competitive, with Hilo expected to continue gaining market share due to its strong product capabilities and comprehensive marketing channel development [1] Group 2 - Smoore, as a core supplier for BAT in the vaping and heated tobacco sector, is likely to benefit significantly from the deepening collaboration as BAT accelerates its smoke-free strategy [1]