Caitong: Maintain the "buy" rating of DPC DASH (01405) and complete the annual store expansion plan ahead of schedule.

Caitong released a research report stating that DPC DASH (01405) continues to achieve steady growth in same-store sales in first-tier cities, while accelerating the pace of expansion in non-first-tier cities. The company's brand momentum continues to rise, and the expansion in scale is expected to further drive performance. It is believed that there is still significant room for expansion in second and third-tier cities, which are expected to contribute to the company's future growth. The "neutral" rating is maintained. Caitong's main points are as follows: Ahead of schedule in completing the annual store expansion plan, multiple first stores opened in various locations by the end of the year, continuing to expand into lower-tier markets On October 10th, the company officially announced that as of the third quarter of this year, there were a net addition of 275 stores, achieving approximately 100% of the target of opening 300 stores this year (including new, under construction, and already signed stores). Also, as the year-end approaches, the first stores in many locations have gradually opened. From the distribution of first stores, they are mainly concentrated in second and third-tier cities. For example, on October 26th, the company entered Hohhot, Inner Mongolia and officially opened the first store there. In December, the company also opened its first stores in Qidong and Putian. In addition, the opening time of the first store in Yunnan has been confirmed, located in Kunming with the opening scheduled for January 1, 2026, and will be simultaneously launched in Shuncheng Shopping Center and Kunming Wanda Plaza. In the first half of the year, the company achieved double-digit growth in revenue and profit, with non-first-tier cities being the main growth driver In 1H2025, the company achieved operating revenue of 2.593 billion yuan, a year-on-year increase of 27.04%, and net profit attributable to the parent company of 66 million yuan, a year-on-year increase of 504.42%, with adjusted net profit of 91 million yuan, an increase of 79.6%. By region, sales in first-tier cities such as Beijing, Shanghai, Guangzhou, and Shenzhen in 1H2025 were 1.084 billion yuan, a year-on-year increase of 7.2%, accounting for 41.8% of revenue, an increase of 7.8 percentage points year-on-year. Sales in non-first-tier cities were 1.509 billion yuan, a year-on-year increase of 46.6%, accounting for 58.2% of revenue, an increase of 7.8 percentage points year-on-year. From the financial reports in the first half of the year, it is evident that non-first-tier cities are becoming the main driving force for the company's revenue growth. The bank believes that there is still significant room for expansion in second and third-tier cities, which are expected to contribute to the company's future growth. Investment recommendation: The bank expects the company's net profit attributable to the parent company in 2025-2027 to be 160 million yuan, 225 million yuan, and 301 million yuan respectively, corresponding to P/E ratios of 59X, 42X, and 32X. The "neutral" rating is maintained. Risk warning: Intensified industry competition, increased cost pressure, lower-than-expected consumption recovery, etc.