Stock prices are surging! Yum China's business is blooming in multiple areas, with a $30 billion shareholder return plan anchored for the long term.

M CHINA YUM CHINA2023YUM CHINAM CHINA's sinking market restaurants, by optimizing equipment and decoration, reduce investment costs while ensuring a large enough area, and meet the high peak demand for dining during holidays in small cities. This flexible and versatile store strategy can help brands quickly expand the market in a short period of time, reduce investment costs, and maintain a good return on investment cycle.It is understood that the healthy payback period of YUM CHINA's new stores is 2 years for KFC and 3 years for Pizza Hut, which is the company's confidence in accelerating expansion. In addition, the company continuously optimizes its cost structure with the comprehensive advantages of brand influence, supply chain management, digitalization, and product innovation. In terms of rent, the majority of the company's leases are currently variable rent, and by 2023, the company's rent ratio will decrease to 8.7%, the lowest level in the past 10 years. Furthermore, YUM CHINA is also focusing on introducing digitalization and artificial intelligence to enhance store operations. For example, the company uses artificial intelligence and data analysis to predict and build a one-click ordering system and automatic scheduling system. Some KFC restaurant managers can manage multiple stores simultaneously, saving on the incremental demand for manpower during store expansion and improving economies of scale. Looking ahead, the Chinese food and beverage market is undergoing profound changes, with the market accelerating reshuffle, and the chain rate and concentration of the industry are both increasing. Relevant data shows that the chain rate of China's food and beverage industry increased from 13% in 2019 to 19% in 2022, but there is still ample room for improvement compared to developed countries like the United States and Japan, where the chain rate is around 50%. As the chain rate of the food and beverage industry increases, the number of stores of leading brands like YUM CHINA is rapidly growing, demonstrating a strong "siphon effect." It is noted that as of 2023, YUM CHINA has a net cash position of $3.7 billion. With ample financial security, the company can achieve "having grain in hand, feeling confident" whether expanding its scale or providing stable returns to investors, maintaining the law of the strong in business over a longer time frame.