Broker: China Galaxy International Securities (CGSI)

Date of Report: March 26, 2026

Excerpt from China Galaxy International Securities (CGSI) report.

Report Summary

• Haidilao’s FY25 revenue grew 1.1% year-on-year to RMB 43.2bn, outpacing expectations due to strong performance from new brands, but net profit fell 14% as beef prices rose and margins narrowed.
• The company is pushing a multi-brand strategy, with non-Haidilao restaurant revenue jumping 215% and strong market feedback for new seafood and sushi brands; significant expansion is planned in these areas.
• Food delivery has become a major growth driver, rising 112% year-on-year to 6.1% of total revenue, with further product development planned.
• Management expects a return to year-on-year positive table turnover rates and revenue growth in FY26, supported by frequent menu updates, new store formats, and marketing campaigns.
• Despite cost pressures, Haidilao is forecast to deliver 5.8% revenue growth and 10% net profit growth in FY26, with margin improvement expected as the business adjusts its cost structure and operational efficiency.
• Target price is set at HK\$17.2 (down from HK\$17.5), with an “Add” rating maintained, reflecting confidence in table turnover and margin recovery, but with risks from raw material costs and competition.
• Haidilao is investing more in new brands, resulting in a slightly reduced dividend payout ratio (87% in FY25 vs. 95% in FY24), and is focusing on technology and operational upgrades to support growth.
• Consensus is strongly positive with 33 Buy ratings, 8 Hold, and 0 Sell, and the company maintains a solid balance sheet and high return on equity.

Above is an excerpt from a report by China Galaxy International Securities (CGSI). Clients of China Galaxy International Securities (CGSI) can be the first to access the full report from the CGSI website: https://www.chinastock.com.hk