Market Overview - A-shares showed mixed performance with over 2300 stocks rising, while the Shanghai Composite Index increased by 0.01%, the Shenzhen Component decreased by 0.11%, and the ChiNext Index rose by 0.26% [1] - The total market turnover was approximately 1.3 trillion yuan, an increase of 169 billion yuan compared to the previous trading day [1] Gold Sector - Gold concept stocks experienced a strong rally, with Hengbang Co. hitting the daily limit and Chao Hong Ji rising over 8%. In the Hong Kong market, Lao Pu Gold surged over 7% and has increased by over 290% year-to-date [5][1] - Lao Pu Gold launched new products, including the "Hulu Baby" and "Seven Sons Hulu" series, which have resonated with customers and showcased the brand's innovation in product design and craftsmanship [8] - The company is expanding its retail presence with new stores in high-profile locations, which is expected to enhance brand influence and improve customer experience [8] Innovative Drug Sector - The innovative drug sector saw significant gains, with Bai Jie Shen Zhou rising 8% to reach a historical high, and other stocks like Hai Si Ke and Ao Sai Kang hitting the daily limit [10] - In the Hong Kong market, Rongchang Biotechnology surged over 20% and China Biopharmaceutical rose over 19%, with the Heng Seng Innovative Drug ETF increasing by 4.34% [10] - China Biopharmaceutical's management announced collaborations with multinational pharmaceutical companies, indicating strong commercial potential for innovative assets [10] - A recent policy document aims to improve the medical insurance drug list, which is expected to enhance access to innovative drugs for the public [10] - The pharmaceutical sector is projected to see its first profit upturn in three years by Q1 2025, driven by the rapid development of innovative drugs and their associated value releases [11]

Company Overview - On May 30, 2025, the company launched new products, the Gourd Baby and Seven Sons Gourd series, effectively combining traditional Chinese cultural elements with exquisite craftsmanship [1] - The new Seven Sons Gourd product showcases the brand's innovation in creativity and craftsmanship, utilizing traditional gourd elements and featuring seven colors, enhancing both individual and collectible value [1] Store Expansion - The company is accelerating its store openings in 2025, with new locations in high-end shopping areas such as Shenzhen MixC, Beijing SKP-S, and Shanghai Harbour City, with some stores reaching 300-400 square meters [2] - The improved location and larger store size are expected to enhance brand influence, product display, and customer experience, maintaining the brand's high-end positioning [2] Market Conditions - Gold prices experienced a brief decline from late April to mid-May but returned to an upward trend, benefiting the company as its products are sold at fixed prices [2] - In Q1 2025, gold prices increased by 19%, and by 7% in Q2 as of June 3, 2025, which is favorable for the sales of the company's gold products [2] Financial Forecast and Valuation - Due to strong sales performance and contributions from new stores, the company raised its net profit forecast for 2025/26 by 42%/48% to 4 billion/5.7 billion yuan, with current stock price corresponding to 39/27 times P/E for 2025/26 [2] - The target price has been increased by 22% to 1,079.06 HKD, reflecting a 12% upside potential from the current price, while maintaining an outperform rating in the industry [2]