Investment Rating - The report maintains a "Buy" rating for the company [1][3]. Core Views - The company reported a Q2 revenue increase of 5.17% year-on-year, but a significant profit decline of 46.79% due to rising costs. The growth in the supermarket channel was notable, with a year-on-year increase of 198%. The B-end performance was weak due to seasonal factors and soft demand, while the C-end franchise stores showed slight improvements [1][6]. - Looking ahead to H2, the company expects to continue engaging with key new clients in the supermarket sector, and cost pressures may gradually ease through price adjustments, leading to anticipated improvements in gross margin and profitability [1][6]. Financial Data Summary - For the fiscal year 2023, total revenue is projected at 799 million, with a decline to 672 million in 2024, followed by a recovery to 729 million in 2025 [2][14]. - The company’s net profit for 2025 is forecasted at 0.90 billion, 1.14 billion, and 1.34 billion for the years 2025, 2026, and 2027 respectively, with corresponding EPS of 0.65, 0.82, and 0.97 [1][7]. - The company’s total market capitalization is approximately 3.6 billion, with a current share price of 26.4 yuan [3][6]. Performance Metrics - The company’s gross margin for Q2 was reported at 18.77%, down 5.93 percentage points year-on-year, primarily due to rising raw material prices. The net profit margin for Q2 was 7.34%, reflecting a decrease of 7.17 percentage points year-on-year [1][6]. - The report indicates that the company has 1,701 franchise stores as of the end of H1 2025, a net decrease of 43 stores from the end of 2024, while the wholesale channel saw a year-on-year increase of 4.8% [1][6].