Weilong Delicious: Continued Recommendation at Low Valuation

English summary

Continue to strongly recommend Weilong Delicious: currently still at a low valuation, continue to recommend (20260730) — Firm-wide level key recommendation. The company's konjac has good growth potential, and the cost dividend in 26H2 is expected to further materialize. We continue to emphasize the investment opportunity in Weilong Delicious. After the recent deep pullback, the current valuation offers high cost performance. The dividend yield in 2023/2024 was both above 5%, so we continue to recommend. #Product: We believe konjac still has category advantages, and the duopoly competitive landscape in the konjac industry is relatively stable. The subsequent launch of new flavors is expected to contribute increment, while adapting to the health-oriented demand trend and emphasizing health-oriented category layout. #Channel: Continue refined management, focus on ROI, and value display optimization; emphasize the deployment of bulk retail channels. We expect the proportion of bulk retail channels to further increase in the future; overseas channels continue to expand, which is expected to continue contributing performance increment. Risk warnings: raw material price increases, konjac new product promotion falling short of expectations, food safety, continued damage to flour product demand, etc. ———————— Contact: Zhang Xiaoqian / Du Wanze / Sui Muhan