Haitong International released a research report forecasting MIXUE GROUP's (02097) revenue for 2025-27 at RMB33.0/38.4/42.2 billion, with net profits of RMB5.80/6.74/7.50 billion, respectively. Given the company's leading position in the global freshly-made beverage industry, Haitong assigned a 25X PE valuation for 2026, translating to a target price of HK$482 (HKD/CNY=0.91). The firm initiated coverage with an "Outperform" rating.
Haitong noted that while food delivery platform subsidies provided some incremental same-store sales growth in 2025, MIXUE GROUP's lower price points limited its active participation in subsidy campaigns. As subsidies gradually phase out, the company faces relatively lighter same-store growth pressure in 2026 compared to peers. Additionally, its recently piloted breakfast products are expected to contribute incremental sales per store.
Furthermore, recent social security and tax policies are expected to drive industry standardization and sustainability, benefiting leading brands like MIXUE GROUP in gaining higher market share.
**Key Highlights:** 1. **Market Leadership**: MIXUE GROUP is China's largest freshly-made beverage chain, operating 53,014 stores globally as of 1H25 (48,281 domestic, 4,733 overseas). According to Frost & Sullivan, it ranked as the world's fourth-largest freshly-made beverage company by 2023 GMV, with a 2.2% market share.
2. **Industry Growth**: Freshly-made beverages represent an upgrade from ready-to-drink products, fueled by rising disposable income. The segment is outpacing China's broader beverage market, with tea drinks showing strong growth potential in lower-tier cities.
3. **Cost Leadership Strategy**: MIXUE GROUP focuses on an integrated "supply chain + brand IP + store operations" model: - **Digitalized End-to-End Supply Chain**: With early adoption of centralized production, the company has built a global sourcing network spanning 38 countries and five production bases. - **Super IP "Snow King"**: The iconic mascot enhances brand appeal and customer loyalty. - **Franchisee Collaboration**: A robust single-store model has driven rapid expansion, adding ~8,000 net stores annually since 2020.
4. **Growth Drivers**: - **Domestic Expansion**: Penetrating untapped markets and lower-tier cities. - **Overseas Markets**: Steady growth in Southeast Asia, with emerging opportunities in Central Asia and the Americas. - **Sub-brands**: Lucky Cup (second growth curve) and newly acquired Fresh Beer Fulu further diversify its beverage portfolio.
**Risks**: Slower economic/consumption growth, market saturation, intensified competition, food safety incidents, and expansion delays.
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