Haitian Flavouring and Food's 2025 profit and dividend commitment exceeds market expectations! Huachuang Securities upgrades to "Strong Buy" rating

On March 27, the leading condiment company, Haitian Flavor Industry, saw a significant increase in its stock price, as its fourth-quarter performance exceeded expectations, acting as a catalyst for its stock price. The food and beverage ETF Huaxia (515170.SH) and the food ETF Huaxia (159151.SZ) both surged over 2% during intraday trading.

Haitian Flavor Industry recently disclosed its full-year performance for 2025: the company achieved operating revenue of 28.873 billion yuan, a year-on-year increase of 7.32%, and net profit attributable to shareholders of 7.038 billion yuan, a year-on-year increase of 10.95%. In Q4 alone, the company achieved operating revenue of 7.245 billion yuan, a year-on-year increase of 11.4%, and net profit attributable to shareholders of 1.716 billion yuan, a year-on-year increase of 12.23%.

The Dong Guangyang/Ouyang Yu team from Huachuang Securities has upgraded Haitian Flavor Industry to a “strong buy” rating. The team commented that the revenue for the full year of 2025 shows stable growth, with a marginal acceleration in Q4 slightly exceeding expectations.

“In recent years, despite weak demand, the company’s upward trend is clear, with stable financial statements and continuous improvement in corporate capability; in the medium to long term, the condiment business model is excellent, and the leading Haitian will remain strong. Future market share gains are certain, and the company has established a dividend plan for the next three years, committing to a dividend payout ratio of no less than 80% of the net profit attributable to shareholders for the years 2026-2027, which warrants a greater certainty premium in a low-interest-rate environment.”

In terms of investment tools, leading food and beverage stocks have a high unit price; investors can enter the segment including condiments through industry-themed ETFs—Food ETF Huaxia (159151.SZ)—with a low entry threshold, as one lot is only a hundred yuan. Due to the downturn in real estate and weak consumer sentiment, the food and beverage sector has undergone a full five-year adjustment, significantly lagging behind the broader market. Currently, the index valuation PE-TTM is only 29 times, lower than over 85% of the past decade, placing it in an extremely undervalued area, offering a high investment cost-performance ratio, along with advantages such as low expectations and low positions, which may open up upward elastic space.

Daily Economic News