GF Securities: Give Shanghai Aunt (02589) a “buy” rating of a reasonable value of HK$121.32

The Zhitong Finance App learned that Guangfa Securities released a research report stating that the adjusted net profit for Aunt Shanghai (02589) for 25-27 is estimated to be 5.6/6.4/76 billion yuan, respectively. The company's development strategy is clear. The integrated market (Shanghai Aunt China) is growing rapidly. The two wings (Tea Falls, Overseas Area) have collaborated to complement each other, cover more customers, and have stronger cyclical resistance. Referring to comparable companies, the company was given a PE valuation of 18 times in 2026, with a corresponding reasonable value of HK$121.32 per share, giving it a “buy” rating.

The main views of GF Securities are as follows:

A mid-priced ready-to-use tea brand that grows rapidly and continues to upgrade

Shanghai Aunt was founded in 2013 and has now become the second 10,000-store brand among mid-priced ready-to-drink teas. Since 25M5 has benefited from the takeout war, the bank expects the company's GMV to perform well. Looking forward to the future, the bank believes that the company's ability to attract new customers and retain users has improved, and the main brand stores are still expected to maintain a certain degree of resilience.

The advantages of card slots in the northern region are obvious

Aunt Shanghai is the brand with the largest number of mid-priced ready-to-drink tea stores in the North. As of the end of '24, the number of stores in the North was 4,784 (about 1,900 more than the second-ranked brand in 23), accounting for 52.1% (no more than 30% of the other top 5 mid-priced brands). The investment model has low investment and low cost, so that franchisees can pay back within a reasonable period. The initial investment of Aunt's store in Shanghai is about 275,000 yuan, which is lower than the average of 350,000 yuan for mid-price ready-made tea. The renewal rate for franchisees in 24 years is 98%, and the proportion of Chinese and old franchisees opening new stores is 48.8%, which confirms that the model is quite successful.

Oriental Tea+Western Coffee covers all drinks at all times

The company grasped consumer demand and actively promoted new products. 25H1 launched 136 new products, 15.8 million quarterly active members, and a quarterly repurchase rate of 40.6%. In terms of expanding categories, the company reorganized the coffee category in '25, and the Shanghai Aunt and Tea Waterfall menus have all added new coffee. The bank expects coffee to contribute to the increase in sales at the same store in combination with categories such as roasting.

Tea Falls accelerates growth and focuses on overseas expansion

Tea Falls's core products are priced at less than 10 yuan, and the card slot pattern is relatively good. The raw materials use real tea and real milk, which has an obvious price-quality advantage. It is very popular in townships and universities. Currently, the number of brand contracts and stores in operation has surpassed 1,000. In terms of going overseas, Aunt Shanghai opened stores in the US and South Korea one after another this year. The company prioritized the layout of the stores in countries with relatively developed economies. The stores generally performed well. It is recommended to actively monitor progress.

Risk warning: macroeconomic fluctuations, store expansion falls short of expectations, and market competition intensifies.