LAOPU GOLD (06181), as the absolute leader in China's traditional ancient-method gold sector, has built a profound brand moat by leveraging intangible cultural heritage craftsmanship, Eastern cultural essence, and top-tier luxury service experiences. This strategy continuously strengthens social recognition and emotional value bonds with high-net-worth individuals, further enhanced by gold's intrinsic value-preserving attribute. Driven by a triple engine of store expansion, deep penetration into high-net-worth customer segments, and rapid online channel growth, the company possesses ample momentum for performance growth and is expected to maintain a high-growth trajectory. Revenue for 2026-2028 is projected to reach RMB 41.44 billion, RMB 52.30 billion, and RMB 63.28 billion, representing year-on-year increases of +52%, +26%, and +21%, respectively. Net profit attributable to shareholders is forecasted at RMB 8.04 billion, RMB 10.30 billion, and RMB 12.63 billion for the same periods, with year-on-year growth of +65%, +28%, and +23%, respectively. This corresponds to P/E ratios of 10x, 7x, and 6x, supporting the maintained "Buy" rating. The main points from Pacific Securities are as follows:
The company released its 2025 annual report, reporting tax-inclusive sales of RMB 31.37 billion, a year-on-year increase of +220.3%. Total revenue reached RMB 27.30 billion, up +221.0% year-on-year. Net profit attributable to shareholders was RMB 4.87 billion, surging +230.5% year-on-year, while adjusted net profit was RMB 5.03 billion, up +234.9% year-on-year. The company also announced a final dividend of RMB 11.95 per share, totaling approximately RMB 2.1 billion in dividends, with full-year dividends amounting to roughly RMB 3.8 billion, representing a payout ratio of about 78%.
Brand momentum continued to expand in 2025, with offline and online channels advancing together, leading to explosive performance growth. By channel, offline and online channels achieved operating revenues of RMB 22.65 billion and RMB 4.66 billion in 2025, increasing by +204.0% and +341.3% year-on-year, respectively. Offline same-store sales maintained high growth, with the company's average annualized sales performance per shopping mall nearing RMB 1 billion, ranking first in store efficiency and sales per square meter among mainland China's luxury brands. Online channel performance was outstanding; the company's flagship store topped the gold category sales charts during both the Tmall 618 and Double Eleven shopping festivals, with transaction volumes exceeding RMB 1 billion and RMB 2 billion, respectively. By region, revenue from mainland China and overseas markets reached RMB 23.36 billion and RMB 3.94 billion in 2025, up +205.4% and +361.0% year-on-year, respectively, indicating accelerated overseas market expansion.
The store network expanded steadily. By the end of 2025, the company operated 45 self-owned stores across 16 cities, all located within 34 renowned commercial centers such as SKP and MixC. Ten new stores were opened throughout 2025, with nine stores optimized or expanded. Following the opening of the Shanghai Henglong Plaza store in October 2025, the company has achieved full coverage of China's top ten leading commercial centers. In overseas markets, the opening of the Singapore Marina Bay Sands store in the first half of 2025 marked a significant step in the brand's internationalization. Customer base deepening progressed, with the core customer segment expanding rapidly. By the end of 2025, the number of loyal members reached approximately 610,000, a year-on-year increase of 74.3%. According to Frost & Sullivan research, the average overlap rate between the company's consumers and those of the five major international luxury brands increased from 77.3% in July 2025 to 82.4% in March 2026, indicating continued consolidation of its position in the high-end customer mindset. The company has precisely positioned itself in core business districts of first-tier and new first-tier cities, consistently securing scarce retail spaces in top commercial complexes like SKP and MixC, further solidifying its top-tier luxury brand positioning and maintaining industry-leading brand momentum.
Short-term gold price fluctuations occurred, but scale effects gradually materialized, leading to steady improvement in profitability. The company's gross profit margin for 2025 was 37.6%, down 3.5 percentage points year-on-year, primarily due to sustained rapid increases in gold prices. Following a price adjustment in October 2025, the gross margin has recovered to above 40%. In terms of expense ratios, benefiting from explosive revenue growth, the company demonstrated good cost control. The sales and distribution expense ratio for 2025 was 11.6%, down 3.0 percentage points year-on-year, and the administrative expense ratio was 2.0%, down 1.2 percentage points year-on-year. Profitability improved steadily, with an adjusted net profit margin of 18.4%, up 0.8 percentage points year-on-year. Scale effects effectively offset the short-term impact of gold price volatility on the gross margin.
Risk warnings include subdued consumer demand, gold price fluctuations, intensified market competition, and store expansion falling short of expectations.
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