Date of Report

October 1, 2024

Broker Name

CGS International Securities

Company Overview

Haidilao is a prominent player in the consumer discretionary sector, known for its innovative hot pot restaurant chain that has gained widespread popularity in China.

Current Market Position

• Current Market Capitalization: HK$ 13.7 billion
• Current Price: HK$ 21.7
• Target Price: HK$ 19.1

Analyst Recommendation

• Recommendation: Add
• Expected Return: The stock’s total return is anticipated to exceed 10% over the next 12 months.

Financial Projections

• Forward P/E (2024): 19.3
• Forward P/E (2025): 17.0

Strategic Outlook

The report indicates that Haidilao is well-positioned to benefit from recent policy initiatives aimed at boosting consumer dining in China. With increasing disposable income and government support for domestic consumption, Haidilao’s unique dining experience is expected to attract more customers.

Risks and Considerations

Investors should remain mindful of potential risks, including competition from other dining establishments, changes in consumer preferences, and overall economic conditions that could influence spending in the restaurant sector.

Summary

Haidilao is presented as a strong investment opportunity within the consumer discretionary sector, supported by favorable government policies and its innovative approach to dining. The anticipated growth in consumer spending on dining positions Haidilao for significant success, making it an attractive consideration for investors.