Saturday Gold Recommendation Update

English summary

Sell-through update: #The company's offline stores saw 20% same-store growth in May, double-digit growth in June, and remained positive in single digits in July despite entering off-season with extreme weather, showing strong resilience. Joint venture Miaoyi mainly operates online channel investment gold sales, with monthly average transaction flow of around RMB 700 million from April to July, translating to a net profit margin contribution to the company of about 0.5%, expected to create substantial incremental gains for the full year. Improving channel & product capabilities: We estimate the company has closed an average of about 35 stores per month since 2026, #with annual store closures expected to be around 400, slowing down compared to 2025. The company is gradually optimizing channels, with a visible effect from focusing on mid-to-high-tier cities. In terms of products, the company continues to strengthen its independent design capabilities, launching gram-weight/fixed-price ancient method gold jewelry, and diversifying IP co-branding to enhance brand competitiveness. Overseas layout progress: The company has previously opened 9-10 overseas stores, with about 10 stores clearly planned for 2026, expecting to add 8-9 new stores for the full year, including self-operated, joint venture, and franchise models. ...