CICC: Resilient Growth in Pet Sector During Double 11, Domestic Leaders Accelerate Market Share Gains

Stock News11-20

According to a research report by CICC, data from Jiuqian and Feigua shows that online sales of pet food reached RMB 4.7 billion in October, marking a 28% year-on-year increase. Leading domestic brands such as Gambol Pet Group Co.,Ltd. (301498.SZ), Xianlang, and Jingu ranked at the top, while brands like Lanshi and Chenshiyikou experienced declines.

In the second half of 2025, the online CR3/CR5 for pet food stood at 12.1%/16.2%, up 2.2/2.8 percentage points year-on-year, indicating accelerated market concentration among top brands. The pet food industry has entered a mid-stage competition, with domestic leaders seizing strategic opportunities to expand market share. Brand rankings are expected to further diverge, potentially accompanied by a temporary rise in expense ratios.

CICC highlights the long-term growth potential of domestic leaders with full industrial chain capabilities, recommending Gambol Pet Group Co.,Ltd. (301498.SZ) and Yantai China Pet Foods Co.,Ltd. (002891.SZ). Key insights include:

1. **Resilient Growth in Pet Sector During Double 11**: - Online pet food sales surged 28% YoY to RMB 4.7 billion. - Domestic brands showed divergence: Gambol, Xianlang, and Jingu led, while Lanshi and Chenshiyikou declined. On Tmall, Xianlang, Myfoodie, and Fregat ranked top three, while Lanshi and Chenshiyikou dropped. On Douyin, Myfoodie and Jingu secured top spots, with Chenshiyikou and Xianlang slipping. - Foreign brands like Royal Canin, Orijen, and Acana improved rankings on Tmall.

2. **Strong Performance of Leading Domestic Brands**: - Gambol reported rapid growth with premiumization acceleration. Its proprietary brands achieved nearly RMB 1.1 billion in online sales, up 44% YoY. High-end products Fregat and BARF contributed 47% of total GMV, up 5.6 percentage points YoY. - Yantai China Pet Foods Co.,Ltd. saw robust growth in its mid-to-high-end Wanpi brand, with Double 11 sales exceeding RMB 100 million, doubling YoY.

3. **Market Share Expansion and Long-Term Profitability Outlook**: - CR3/CR5 rose significantly, reflecting faster consolidation among top brands. - Short-term expense ratios may increase as brands prioritize revenue and market share growth. However, profitability recovery is expected once competition stabilizes and premiumization advances.

**Risk Factors**: Intensified brand competition, raw material price volatility, trade tensions, and overseas operational risks.

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

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