According to the Zheshang Securities Research Report, 2023H1 Xiabuxiabu (00520) achieved operating income of 2,846 billion yuan (yoy +32%) and achieved net profit of 2.41 million yuan, turning losses into profits over the previous year. The sharp increase in revenue was mainly due to the resumption of customer flow and store expansion. Profit growth fell short of expectations. The bank's forecast is mainly due to the slow recovery in consumption since the beginning of the year, and the recovery of employee costs and rent costs has been slower than expected.

According to the bank, the company began reforms in 2021 and has now entered a harvest period. 1) The main brand Xiabu adheres to the concept of “high cost performance”, speeding up store opening and improving store efficiency. 2) With the help of the Group's stored value concession activities, Minato has rapidly expanded its membership base, and the turnover rate has rebounded somewhat. The company is a multi-brand restaurant leader. With personnel and brand strategy adjustments settled, the company is expected to break out of the trough and usher in an inflection point in performance, driven by the two brands Minato Minato and Xiabuxiabu.

The bank expects the company's net profit from 2023-2025 to be 1.74/2.76/400 million yuan respectively, the year-on-year growth rate from 2024-2025 to 59%/45%, respectively, and PE corresponding to 2023-2025 being 22/14/10, respectively. Considering the company's undervaluation and high flexibility in performance, the bank maintains a “increase in holdings” rating.