Daiwa released a research report stating that after reviewing September and early October National Day Golden Week data, the firm continues to favor Yum China (09987) and Guming (01364) within the China restaurant sector.
Among these, the firm reiterated Yum China as its top pick among Chinese restaurant stocks, assigning a "Buy" rating, while maintaining a "Buy" rating on Guming.
Daiwa noted that Yum China's same-store sales in the third quarter may have declined slightly year-on-year, but the market may have already priced in related factors, including McDonald's collaboration with G-Dragon PEACEMINUSONE being promoted across approximately 7,000 stores in China from October 8 to November 3, as well as the opening of Tastien's new pizza brand focused on "Chinese burgers." Yum China's share price has fallen about 17% since mid-August, and the firm believes the stock price level has bottomed out.
The firm cited channel data indicating that Guming's per-store gross merchandise value (GMV) for October 1 to 7, 2026 may have recorded high single-digit year-on-year growth, faster than the mid single-digit increase in September, and continues to outperform its freshly made tea beverage peers.
Additionally, Daiwa expects Haidilao (06862)'s table turnover rate in September to have declined slightly both year-on-year and quarter-on-quarter due to seasonal factors, while the table turnover rate from October 1 to 7 rose slightly year-on-year. Jiumaojiu (09922)'s Tai Er brand recorded same-store sales growth of 15% to 20% during the National Day Golden Week, extending the high double-digit growth trend from September, likely driven by factors such as the timing shift of the Mid-Autumn Festival holiday, mall store foot traffic, and a relatively low base.
Xiaocaiyuan (00999) saw foot traffic and total dine-in revenue increase by 24% and 13.5% year-on-year respectively from October 1 to 7. In terms of ratings, the firm currently assigns Haidilao an "Outperform" rating and Jiumaojiu an "Underperform" rating.
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