External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

Equity Bottom-Up

<ul><li>What is new? DPC Dash announced a positive profit alert for 1H24. For 1H24, the company is now expecting that:1) sales to increase by 45%+ YoY to RMB 2.0bn</li><li>2) net profit to be at RMB 10.0mn+ (vs RMB 8.8mn in 1H23), 3) adj. net profit to be at RMB 48mn+ (vs RMB 17.4mn losses in 1H23).</li><li>Also, the company has opened 146 net new stores (12/ 134 in mature/ emerging markets) and total number has reached 914, representing 36% YoY growth.</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

What is new? DPC Dash announced a positive profit alert for 1H24. For 1H24, the company is now expecting that:1) sales to increase by 45%+ YoY to RMB 2.0bn2) net profit to be at RMB 10.0mn+ (vs RMB 8.8mn in 1H23), 3) adj. net profit to be at RMB 48mn+ (vs RMB 17.4mn losses in 1H23).Also, the company has opened 146 net new stores (12/ 134 in mature/ emerging markets) and total number has reached 914, representing 36% YoY growth.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

DPC Dash (1405 HK) - Outlook Stays Healthy After Positive Profit Alert

Thematic (Sector/Industry)

<ul><li>The 5-1 golden week holidays remain mixed, sales growth is resilient but the underlying are weak (traffic, ASP, discounts and margins), hence we stay conservative on the 2Q24E outlook.</li><li>Overall speaking, with the weak macro environment (e.g. dilution from outbound tourism, property prices and unemployment concerns), achieving such tourism sales growth (at roughly 7.6% YoY) and retail sales growth (at around 6.8% YoY) are already satisfying.</li><li>However, overhangs such as: 1) weak purchasing power per person, 2) drags on margin due to price wars and 3) potentially weak post holidays consumptions are still there. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

The 5-1 golden week holidays remain mixed, sales growth is resilient but the underlying are weak (traffic, ASP, discounts and margins), hence we stay conservative on the 2Q24E outlook.Overall speaking, with the weak macro environment (e.g. dilution from outbound tourism, property prices and unemployment concerns), achieving such tourism sales growth (at roughly 7.6% YoY) and retail sales growth (at around 6.8% YoY) are already satisfying.However, overhangs such as: 1) weak purchasing power per person, 2) drags on margin due to price wars and 3) potentially weak post holidays consumptions are still there. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Consumer Discretionary - Cautiously Optimistic After a Mixed Golden Week

<ul><li>While the FY23 results of DPC Dash (DPC) were roughly inline, we do find its GP margin and sales per store growth very decent and should support a better outlook in FY24E.</li><li>DPC remains our top pick in the catering sector, thanks to its value for money position, huge room for expansion in China and esp. its consistent success in new growth markets.</li><li>We maintain BUY but fine-tune its TP with a lower P/S.</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

While the FY23 results of DPC Dash (DPC) were roughly inline, we do find its GP margin and sales per store growth very decent and should support a better outlook in FY24E.DPC remains our top pick in the catering sector, thanks to its value for money position, huge room for expansion in China and esp. its consistent success in new growth markets.We maintain BUY but fine-tune its TP with a lower P/S.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

DPC Dash (1405 HK) – Sales Beats as New Markets Continue to Succeed

<ul><li>A mixed CNY, robust topline was likely aided by seasonality while the fall in spending power and price war continued.</li><li>We do agree both passenger flows and overall sales were strong during the CNY holiday, given that the spending power was somewhat diluted by the resumption of outbound tourism.</li><li>But on the other hand, the 2024 CNY holiday was a longer-than-usual one and contained one more Saturday and also the Valentine’s Day, hence the recovery rate after adjustment may just be stable (instead of improvements vs 4Q23).</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

A mixed CNY, robust topline was likely aided by seasonality while the fall in spending power and price war continued.We do agree both passenger flows and overall sales were strong during the CNY holiday, given that the spending power was somewhat diluted by the resumption of outbound tourism.But on the other hand, the 2024 CNY holiday was a longer-than-usual one and contained one more Saturday and also the Valentine’s Day, hence the recovery rate after adjustment may just be stable (instead of improvements vs 4Q23).Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

China Consumer Sector – CNY Was Mixed and We Stay Conservative

<ul><li>We initiate coverage on DPC Dash with BUY and TP based on a 2.3x FY24E P/S, and put it as our sector top pick.</li><li>We forecast 36% sales CAGR in FY22-25E and 0%/ 3% adj. NP margin in FY24E/25E, driven by rapid store expansion and store ramp-up in new growth markets.</li><li>Moreover, Domino’s Pizza has managed to capture the No.1 or No. 2 spot in Japan, South Korea and the Taiwan region, hence for the mainland China, we do expect it to surpass Champion Pizza (with over 2,200 stores) in long run. Current valuation of 1.8x FY24E is not demanding.</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

We initiate coverage on DPC Dash with BUY and TP based on a 2.3x FY24E P/S, and put it as our sector top pick.We forecast 36% sales CAGR in FY22-25E and 0%/ 3% adj. NP margin in FY24E/25E, driven by rapid store expansion and store ramp-up in new growth markets.Moreover, Domino’s Pizza has managed to capture the No.1 or No. 2 spot in Japan, South Korea and the Taiwan region, hence for the mainland China, we do expect it to surpass Champion Pizza (with over 2,200 stores) in long run. Current valuation of 1.8x FY24E is not demanding.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

DPC Dash (1405 HK) – Value, Delivery and New Markets-Driven Growth

China

DPC Dash Ltd, also known as "Domino's Pizza China", operates franchise fast food restaurants. The Company through its chain stores, supplies pizza, drinks, and other related snacks. DPC Dash operates as the master franchisee in China Mainland, Hong Kong, and Macau.

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DPC Dash (1405 HK)

DPC Dash (1405 HK) - Outlook Stays Healthy After Positive Profit Alert

What is new? DPC Dash announced a positive profit alert for 1H24. For 1H24, the company is now expecting that:1) sales to increase by 45%+ YoY to...

CMB International

Consumer Discretionary - Cautiously Optimistic After a Mixed Golden Week

The 5-1 golden week holidays remain mixed, sales growth is resilient but the underlying are weak (traffic, ASP, discounts and margins), hence we...

CMB International

DPC Dash (1405 HK) – Sales Beats as New Markets Continue to Succeed

While the FY23 results of DPC Dash (DPC) were roughly inline, we do find its GP margin and sales per store growth very decent and should support a...

CMB International

China Consumer Sector – CNY Was Mixed and We Stay Conservative

We do agree both passenger flows and overall sales were strong during the CNY holiday, given that the spending power was somewhat diluted by the...

CMB International

DPC Dash (1405 HK) – Value, Delivery and New Markets-Driven Growth

We forecast 36% sales CAGR in FY22-25E and 0%/ 3% adj. NP margin in FY24E/25E, driven by rapid store expansion and store ramp-up in new growth...

CMB International

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