霸王茶（CHA）2026年一季度业绩超预期；宣布股票回购

Results China ConsumerRestaurants 1Q26 beat: Regain strength post 2025stress with buyback plan,Maintain Buy Han ZhangResearch Analyst+852-2203-5802 1Q results beat; share repurchase announcedChagee (CHA)1Q26revenueatRMB3,546mn(up5%YoY)wasslightlyaheadour expectation.1Qnon-GAAPnet profit (excl.share-based compensationcost)ofRMB507mn(down25%YoY)beatmarketexpectations:1QGPM increased byaround2pptQoQandYoYmainlyduetomilder-than-expectedpressurefromrawmaterialsupgradeandhigher-than-expectedcontributionsfromtheconversionoffranchise storesto company-owned stores. Themarkethas discussed Chagee'spotential topaydividends and (or)conduct asharerepurchaseforawhile.The companyhasfinallyannounced a sharerepurchase programof uptoUSD150mn ofClassAordinaryshares (i.e.~8%yieldbasedoncurrentmarketcap)inthe12months startingJune1,2026.Basedonthestock's undemanding valuation (9x 2026E P/E) and its strong net cash position(~RMB7bn by2025),webelievethe choice of repurchase,ratherthana dividend,betteraligns the interests of Chageeand investorsatthis moment. Perseverance,morethanlowvaluation,deservesrevisitingPost Chagee's successful IPO inApr.2025,we observed that investors gradually lostconvictioninthecompanyamidatough2025(incl.theunexpectedsubstantialimpactfromthedelivery-subsidywarandthecompany'stemporaryinefficientstaffand resourceutilization).Inpastfewmonths,investors checkedthis name slightlymore often, but we think this was moretodo with its historical low valuation at 6x2026EP/Evs peers at 14x.The1Q26 results serve as a wake-up call forthe market,demonstratingthatChagee,despitebeingarelativelyyoungcompany,iscapablelong-term focus on consumer values, and strong execution of the strategiesadopted since2H25 Behind the bottomingout of1Q26averagemonthlyGMVperteahouse (atRMB 356 thousand,vs.historical low of RMB 337 thousand in 4Q25) inChina, Chagee,unlike being a victim of 2025's subsidywar,nowis able toeffectively capture the benefits from thedelivery platform's"Qian Wen"campaign in Feb.2026 and generated an average of 3mn orders per dayduring the campaign. RestaurantsChagee cost ratios (as % of revenue) dropped by 0.2ppt/0.6ppt YoY, and thecompany'sheadcountoptimizationhashelpedputastoptotheescalatingtrend of non-GAAPG&Aexpense ratio since 2Q25.Post strategic slow-down in product initiatives in 2025, Chagee has accelerated its newproduct pipeline:1)the company launched 12newproducts inChina in1Q26permanagement and locallytailored productswererolledoutinoverseasmarkets.2)Figure1showedthatthepaceofnewproduct launches remained fast in Apr. and May.Management alsohighlighted the successful introduction of new consumption scenarios,including the morning buy-one-get-one-free campaign anda low-caffeineevening section. Valuation:Earnings lifted while PT unchanged at USD19.70,Reiterate BuyFactoring in1Q26 resultsandanalyst-briefingtakeaways,we liftedour2026E-28E non-GAAP net profit by 4% on average mainly due to the potentially higher-than-expected GPM implied in 1Q26 and long-term operational efficiency upsidepotentials. We revised down our estimate for the medium-term growth rate to 4%from5%inourDCFmethodology,givenmacro-environmentuncertainty.OurDCF-based PT, which uses a terminal growth rate of 1%, and a WACC of 13%(2% risk-freerate,6%equityriskpremium,betaof1.6),thereforeisunchangedatUSD19.70,implying13x2026EP/E.Maintain Buy. Keydownsiderisks:1)more intensemarket competition; 2)slower-than-expectedstoreexpansion;3)lossofcontroloverfranchisepartners; 4)rawmaterialcostandqualityfluctuations; 5)food safetyissues. RestaurantsChagee RestaurantsChagee RestaurantsChagee Chagee, established in 2017, is a leading premium freshly- made tea drinks brand in China. It mainly serves fresh milktea (core products including tea latte and teapuccino) andpure tea drinks, etc. As of the end of 1Q25, Chagee's storenetwork covered 6,681 teahouses, with 6,512 located inChina and 169 in overseas markets. Cash Flow (CNYm)Cash flow from operations Balance Sheet (CNYm) KeyCompanyMetrics HanZhang+852 22035802han-a.zhang@db.com RestaurantsChagee Appendix 1 ImportantDisclosures *Other information available upon request nformaticantriskandconflictdisclosures can also befoundathttps://research.db.com/Research/Disclosures/Disclaimer.Investorsarestrongly ImportantDisclosuresRequiredbyU.S.RegulatorsDisclosures marked with an asterisk mayalso be required by at least one jurisdiction in addition to the United States.See 1.Within the past year, Deutsche Bank and/or its affiliate(s) has managed or co-managed a public offering for this company,for which it received fees.7.Deutsche Bank and/or its affiliate(s) has received compensation from this company for the provision of investmentbankingorfinancialadvisoryserviceswithinthepastyear.8.Deutsche Bank and/or its affiliate(s) expects to receive, or intends to seek, compensation for investment bankingservicesfromthiscompany inthenextthreemonths.14.investmentbankingrelatedservices15.investmen