Huaxi Securities released a research report stating that GUMING (01364) has established a virtuous cycle of scale and efficiency through its high-quality, cost-effective product strategy, regionally dense store network, and self-built cold-chain supply chain. The company has demonstrated steady performance growth and is expected to further boost per-store sales via product category expansion and brand enhancement. Optimized franchise policies are projected to drive over 100% growth in store count.
The report forecasts 2025-2027 EPS at RMB 1.16/1.21/1.45, with corresponding P/E ratios of 17.4x/16.7x/14.0x, initiating coverage with a "Buy" rating. Key insights include:
**Market Position** Since its founding, GUMING has focused on delivering fresh, consistent, and affordable premium beverages. After 15 years of steady growth, it has become a leading brand in China's tea-drink industry. As of June 2025, it operates 11,179 stores across 200+ cities. Primarily adopting a franchise model, the company generates revenue mainly from product/equipment sales and services to franchisees. In H1 2025, revenue reached RMB 5.66 billion (+41.2% YoY), with adjusted net profit at RMB 1.09 billion (+42.4% YoY) and adjusted net margin at 19.2% (+0.2 ppts).
**Competitive Edge** Unlike peers, GUMING employs a unique strategy: frequent product refreshes ("shelf-type" SKU updates) and regional clustering for store expansion, supported by its proprietary cold-chain logistics system. Dense store networks shorten delivery radii, reduce logistics costs, and enable high-frequency ingredient replenishment (pioneering "every-two-day delivery" in the industry), reinforcing its "freshness" promise. Cost savings from supply chain efficiencies translate into pricing advantages, sustaining its value-for-money positioning and improving franchisee profitability—further accelerating store growth and economies of scale.
**Growth Drivers** While GUMING doesn’t directly share franchisees’ revenue, its income correlates closely with franchise GMV. Thus, per-store sales growth and store count expansion remain core drivers. Short-term, per-store sales benefit from food-delivery promotions; long-term, category/scenario diversification and brand strength will sustain momentum. Franchise policy adjustments in February 2025 boosted new加盟 confidence, accelerating openings. With continued regional densification and expansion into untapped markets, Huaxi estimates GUMING’s potential store count in mainland China could exceed 35,000—more than doubling current levels.
**Financial Projections & Valuation** Huaxi forecasts 2025-2027 revenue of RMB 12.46/15.68/18.43 billion (+41.7%/+25.8%/+17.6% YoY) and net profit of RMB 2.77/2.89/3.45 billion (+87.3%/+4.3%/+19.5% YoY). At the latest closing price (HKD 22.3 on Nov 14; 1 HKD = 0.91 CNY), the P/E multiples stand at 17.4x/16.7x/14.0x for 2025-2027.
**Risks**: Intensified competition, food safety issues, slower category expansion, or store growth delays.
Comments