[Zhenzhuo Institutional View] Lao Pu Gold (06181.HK): Profits Exceed Expectations; Store Expansion Pace Reasonable
$LAOPU GOLD(06181.HK) Preliminary 2025 results show net profit grew approximately 226% to 233% year-on-year, with revenue increasing about 217% to 229%, both exceeding market expectations. The core net profit margin expanded slightly compared to 2024, indicating that growth was driven by operating leverage rather than promotional volume, with convincing profit quality.
The company opened 10 new stores and optimized/expanded 9 stores throughout the year, with both online and offline channels experiencing simultaneous volume growth. Fixed pricing combined with multiple price adjustment mechanisms solidifies its high-end positioning. The annualized contribution from new stores in 2026 and same-store growth will proceed in parallel, providing a clear foundation for continued profitability.
Main risks include gold price volatility, intensifying competition, and weakening domestic consumption. However, management aims to maintain gross margin above 40%, providing some assurance of pricing power. At this stage, the stock price may still not fully reflect the medium-to-long-term profit potential, maintaining a positive outlook.
Source: KGI Securities
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