Investment Rating - The report assigns a "Buy" rating for the company, marking its first coverage [11]. Core Insights - The report highlights that Haidilao is a large restaurant enterprise with a rich brand matrix, distinctive management features, and strong supply chain barriers. The company is expected to continue leading the restaurant market due to its exceptional service, high operational efficiency, and mature supply chain system [3][9]. Company Overview - Haidilao, centered around Sichuan hot pot, has evolved into a global leader in Chinese dining over thirty years. The company's development can be categorized into three phases: expansion, deep adjustment, and new brand exploration. It has established a dual-driven growth model combining its main brand and new brands [6][20]. - The company emphasizes extreme service, which has become a hallmark of its brand, and has a stable shareholding structure with concentrated ownership by the founding team, ensuring effective strategic execution [6][35]. Industry Analysis - The hot pot industry is the largest segment of Chinese cuisine, projected to exceed 600 billion yuan in market size by 2024, capturing approximately 14.5% of the overall Chinese dining market. The industry is characterized by a high degree of standardization and operational efficiency, making it easier to manage supply chains and replicate stores quickly [7][63]. - Despite being a leading brand, Haidilao holds only a 6.9% market share, indicating significant competition from numerous small and specialized hot pot restaurants [7][82]. Competitive Advantages - Haidilao's core competitive advantages include exceptional service, strong management capabilities, and a robust supply chain, which together create a formidable brand moat. The company has implemented a unique apprenticeship system to ensure service quality and operational efficiency [8][43]. - The company is also focusing on a dual-brand strategy, leveraging its main brand while rapidly developing new brands to capture additional market share [9][61]. Financial Performance and Projections - The report forecasts that Haidilao will achieve net profits of 4.335 billion, 4.782 billion, and 5.278 billion yuan from 2025 to 2027, reflecting a positive growth trajectory [9]. - In 2023, the company experienced a significant recovery, with revenue increasing by 19.3% and net profit surging by 227.3%, primarily due to increased customer traffic and optimization of underperforming stores [51].