ZHONGYIN BABI FOOD CO.(SH:605338)2024-01-05 09:35Group 1: Company Advantages - The "Babi" brand has a strong market presence in the breakfast chain industry, recognized for its clean and uniform store image, diverse product line, and robust R&D capabilities, making it a well-known brand in Chinese pastry products [1] - The company has established a strong supply chain and logistics system, ensuring timely delivery of fresh ingredients to franchise stores, which supports product quality and stability [1] - Babi Foods views franchisees as close partners, providing targeted support and regular communication to enhance franchise management and service [1] Group 2: Store Performance and Future Trends - Current single-store revenue still shows a gap compared to 2021, which was the best-performing year for the company [2] - The company plans to increase the number of franchise stores, optimize product structure, and improve gross profit margins to address the revenue gap and maintain steady growth [2] - The competitive landscape in the breakfast market is intensifying, with a growing number of suppliers and diversified consumer choices, which may lead to a more balanced market share distribution [2] Group 3: Operational Efficiency - Increasing the number of franchise stores in the same area can enhance logistics efficiency and reduce transportation costs, while also improving management efficiency [2] - The company is focusing on digital transformation and technology empowerment to enhance operational efficiency through advanced management systems [2] - Emphasis on lean management and standardization in production and logistics is expected to improve production efficiency and overall gross margin [2] Group 4: Pre-prepared Food Market - The pre-prepared food market is highly competitive, but the company has advantages in raw material procurement, production line capabilities, and logistics [3] - The pre-prepared food market in China was valued at 419.6 billion yuan in 2022, with a year-on-year growth of 21.3%, and is projected to reach 1,072 billion yuan by 2026 [3] - The company aims to leverage its existing business foundation to contribute new growth points to its group meal sales revenue [3] Group 5: Capacity Expansion - The company has established production capacities in key cities, with new facilities in Dongguan and Wuhan expected to come online in 2024 and 2025 [3] - The annual depreciation expense for the Dongguan factory is estimated at 4 million yuan, with similar expectations for the Wuhan factory [3]