CHACHA FOOD CO.,LTD(SZ:002557)2026-01-23 15:35Summary of Conference Call Records Industry Overview - The conference call focuses on the food and beverage industry, particularly the impact of raw material cost fluctuations on company profitability and investment opportunities in 2026 [1][2]. Key Points on Companies and Financial Impacts 1. Impact of Sunflower Seed Prices on ChaCha Food - In 2025, the price of sunflower seeds increased, causing ChaCha Food's sunflower seed business gross margin to drop from nearly 30% to around 21%, significantly pressuring profitability [1][3]. - It is expected that in 2026, sunflower seed procurement prices will decrease by 10% to 15% year-on-year, which will positively impact the gross margin of sunflower seeds by 5 to 8 percentage points and contribute 3 to 5 percentage points to the overall gross margin [1][3]. - This improvement is projected to lead to a profit increase of approximately 70%, reaching 640 million yuan, with a corresponding PE valuation of less than 19 times [1][3]. 2. Impact of Konjac Powder Prices on Wei Long and Yan Jin Pu Zi - The konjac snack market gained attention in 2025, but the significant rise in konjac powder prices (from 4.2 yuan/kg to 7-8 USD/kg) pressured the gross margins of related companies [1][4]. - In 2026, it is anticipated that the cost of konjac powder will decrease by 10% to 20% year-on-year, which will positively contribute 1 to 3 percentage points to Wei Long's gross margin and 1 to 2 percentage points to Yan Jin Pu Zi's gross margin [1][4]. Non-linear Effects of Cost Declines - The impact of declining raw material costs on company performance is typically non-linear. Factors such as the need to digest high-priced raw material inventory, aggressive pricing pressure from downstream channels, and competitive strategies may lead to a loss of some benefits [1][5]. - Companies may also take the opportunity to reinvest strategically, making the final transmission effects dependent on specific market dynamics and competitive outcomes [1][5]. Additional Insights - The recovery of sunflower seed planting areas and normal weather conditions are the main reasons for the expected decline in sunflower seed prices [1]. - An increase in konjac planting areas is driving the anticipated decrease in konjac powder prices [1].