Investment Rating - The report assigns a "Buy" rating for IFBH (6603.HK) with a first-time coverage [1]. Core Insights - The coconut water industry in China is expected to maintain rapid growth, with IFBH holding a leading market position [5][13]. - The company's revenue is projected to grow significantly, supported by a light asset business model that ensures high profitability [29][41]. - The report highlights the potential for further market share growth in the coconut water sector, especially when compared to other beverage categories [22][25]. Industry Overview - The coconut water market in mainland China is projected to grow from $49.7 million in 2019 to $1,018.1 million by 2024, with a compound annual growth rate (CAGR) of 82.9% [15]. - The industry growth is driven by increasing health awareness, improved distribution channels, and a broader consumer base [15]. - By 2029, the market size is expected to reach $2,550.4 million, indicating a continued strong growth trajectory [15]. Company Performance - In 2024, IFBH's revenue is expected to reach $158 million, a year-on-year increase of 80.29%, with a net profit of $33 million, up 98.85% [41]. - The company maintains a high gross margin of approximately 36.7% and a net margin of 21.13% in 2024 [43]. - The revenue from the IF brand accounts for over 83% of total sales, with the majority of revenue generated from mainland China [46]. Market Position - IFBH holds a 33.9% market share in the coconut water segment in mainland China, significantly ahead of its closest competitor [18]. - The company has consistently ranked first in the coconut water market in both mainland China and Hong Kong since 2020 [18][21]. - The report notes that the per capita consumption of coconut water in mainland China is still low compared to markets like Hong Kong and the U.S., indicating substantial growth potential [27]. Business Model - IFBH employs a light asset model, outsourcing manufacturing and logistics, which helps maintain low operational costs and high profitability [29][41]. - The company focuses on brand operation, product development, and marketing while relying on third-party distributors for sales [30][64]. - The report emphasizes the importance of brand equity and product development capabilities over owning production facilities [71]. Future Outlook - Revenue forecasts for 2025-2027 suggest continued growth, with expected revenues of $200.91 million, $271.34 million, and $355.23 million, respectively [41]. - The company plans to expand its product offerings beyond coconut water, including fruit-based beverages and plant-based drinks [47]. - The strategic partnership with COFCO is expected to enhance distribution capabilities and market reach [70].

Group 1 - The company's revenue for the six months ending June 30, 2025, was $94.5 million, representing a 31.5% increase compared to the same period in 2024 [1] - Adjusted net profit for the same period was $18.9 million, an increase of 13.9% year-on-year [1] - Coconut water revenue increased by 33.3% year-on-year, driven by the company's efforts to penetrate the mainland China market and a significant increase in sales volume [1] Group 2 - Other beverage revenue saw a substantial increase of 57.2% year-on-year, primarily due to the popularity of drinks such as longan juice, lychee juice, peach juice, and aloe vera grape juice, which collectively accounted for 76.6% of other beverage revenue [1] - Revenue from longan juice, lychee juice, vitamin C peach juice, and aloe vera grape juice increased by 100.0%, 111.4%, 127.1%, and 45.9% respectively [1] - The mainland China market is expected to remain the primary source of total revenue for the company in the foreseeable future, with anticipated increases in sales through both online and offline channels [2]