CICC: Maintaining the target price of Tsubame House (01497) of HK$6.95, “outperforming the industry”

The Zhitong Finance App learned that since the expansion performance of the online channel of Yanzhiya (01497) exceeded expectations, and the company could increase hedging expenses through gross margin, the bank raised its 2026/27 profit forecast by 18%/19% to 227/233 million yuan, maintaining a target price of HK$6.95. The target price corresponds to the 26/27 12.2/11.6x price-earnings ratio. The current stock price corresponds to the 26/27 price-earnings ratio of 9.6/9.1 times, with 27.5% upside compared to the target price.

CICC's main views are as follows:

1H26 performance is higher than expected

The company announced 1H26 results: total revenue of 1H26 was 1.82 billion yuan, up 16.5% year on year, profit was 111 million yuan, up 47.1% year on year. The profit performance exceeded this forecast, mainly driven by the rapid development of 1H26 online emerging channels and a low base of goodwill impairment during the same period last year.

1H26 online interest e-commerce channels showed outstanding performance, and KA and new retail expansion buffered traditional offline pressure

In terms of channels, the company's 1H26 online channel revenue was 770 million yuan, +21.7% year-on-year, accounting for 65.2%, mainly driven by the volume of e-commerce interests such as Douyin and the growth of traditional e-commerce; traditional offline channels are still under pressure from the weak consumer environment. The company actively expanded KA and new retail channels to form a certain hedging, with 1H26 offline channel revenue of 412 million yuan, +7.8% year-on-year. In terms of products, revenue from 1H26 pure bird's nest products was +15.0% year over year, revenue from bird's nest+ and + bird's nest products was +30.8% year-on-year, and the company's category expansion continued.

Strong revenue compounded the low profit base for the same period, improved gross margin and increased hedging expense investment, driving 1H26 profits to grow rapidly

1H26's gross profit margin was 53.7%, +1.7ppt year over year, mainly due to increased manufacturing efficiency and cost structure optimization; during the same period, the company increased marketing and brand investment, and the sales expense ratio was +1.5ppt to 34.4% year over year, and gross margin improved and basic hedging expense ratio increased. In addition, 1H25 calculated goodwill impairment of 9.179 million yuan, and the low base effect further increased profit performance; overall, 1H26's net profit to mother was 111 million yuan, +47.1% over the same period last year.

Currently, the company's expansion of emerging channels and rich product matrices are driving rapid revenue growth. Looking ahead to the future, if consumer intentions pick up, the early channel layout is expected to release increases, and superimposed manufacturing efficiency improvements will support improvements in operating efficiency.

Risk warning: Weak macro-consumption puts pressure on industry growth, worsening industry competition pattern, safe supply of upstream raw materials, backlog of downstream channel inventory, underperformance of new products, bird's nest public opinion events, risk of dependency on a single product, and risk of the company's strategic sustainability after listing.