Aijian Securities initiates coverage on MIXUE with a "Buy" rating, citing supply chain advantages as the core competitive strength

Aijian Securities published a research report stating that MIXUE GROUP (02097.HK), as the world's largest fresh beverage company, has established a leading position in the fresh tea beverage sector through its end-to-end supply chain system and a network of 53,000 stores, creating scale effects. Its supply chain advantages forge its core competitiveness.

The firm expects the company's operating revenue for 2025 to 2027 to be RMB 33.55 billion, RMB 40.3 billion, and RMB 44.39 billion respectively, with year-on-year growth of 35.1%, 20.1%, and 10.1%. Net profit is expected to be RMB 6 billion, RMB 7.4 billion, and RMB 8.41 billion respectively, with year-on-year growth of 34.9%, 23.6%, and 13.7%, corresponding to price-to-earnings ratios of 24.2 times, 19.6 times, and 17.3 times. The firm initiates coverage on MIXUE GROUP with a "Buy" rating.

The firm predicts that in terms of product and equipment sales, the group will maintain a steady pace of store expansion, with continued penetration in domestic lower-tier markets and increased penetration rates in first- and second-tier cities. It expects the group's product and equipment sales revenue for 2025 to 2027 to be RMB 32.68 billion, RMB 39.22 billion, and RMB 43.14 billion respectively, with year-on-year growth of 35%, 20%, and 10%. The improvement in supply chain capacity utilization will drive cost optimization, with expected gross margins of 30.6%, 31%, and 31.5%.

The firm also predicts that in terms of franchise and related services, the continuous expansion of the store network will drive growth in franchise fees and service revenue, with expected operating revenue for the group in 2025 to 2027 to be RMB 870 million, RMB 1.09 billion, and RMB 1.25 billion respectively, with year-on-year growth of 40%, 25%, and 15%. As the maturity of the franchise system improves and service capabilities strengthen, expected gross margins will be 83%, 83.3%, and 83.6%.

The firm continues to state that the market believes the group's low-price model is easily replicable, growth space is limited, and quality control in the franchise system is difficult to guarantee. However, it believes that the group's full-link supply chain system builds cost barriers, and the scale effect reinforces the sustainability of its low-price positioning; the mechanism binding the interests of franchisees is mature, and the scale of 10,000 stores validates the replicability and stability of the business model; the Snow King IP builds its own traffic barriers, breaking the industry's reliance on external collaborations