CHINA SNACKS: 2Q26/1H26 Preview: Soft Sales, Resilient Margins; Nuts/Seeds outperform and shareholder returns in Focus; Upgrade Chacha to Buy

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CHINA SNACKS: 2Q26/1H26 Preview: Soft Sales, Resilient Margins; Nuts/Seeds outperform and shareholder returns in Focus; Upgrade Chacha to Buy

Equity Research

7 July 2026 | 8:32PM HKT

CHINA SNACKS

2Q26/1H26 Preview: Soft Sales, Resilient Margins; Nuts/Seeds

outperform and shareholder returns in Focus; Upgrade Chacha to Buy

We expect our snacks universe to experience a pullback in 2Q26 following strong Valerie Zhou

+852-2978-0820 | valerie.zhou@gs.com

CNY shipments in 1Q26, at -3% weighted avg. sales yoy for our covered companies in Goldman Sachs (Asia) L.L.C.

2Q26 vs 14% yoy in 1Q26. This deceleration is primarily driven by the CNY calender Leaf Liu

shift, muted consumer demand during the non-peak season, persistent weakness in +852-3966-4169Goldman Sachs (Asia)| leaf.liu@gs.comL.L.C.

traditional retail channels, and companies’ ongoing strategic trimming of low-margin Christina Liu

online channels albeit partially offset by rapid value retail openings. Despite the +852-2978-6983Goldman Sachs (Asia)| christina.liu@gs.comL.L.C.

overall sector slowdown, we see several key bright spots: 1) Chacha’s

outperformance at +11% yoy sales in 2Q26. This resilience is driven by a more

favourable competitive dynamic in nuts and seeds in our view and the company’s

more proactive collaboration with emerging channels, meanwhile margins are

showing meaningful recovery from their trough aided by lower procurement input

costs (see our upgrade note); 2) Solid Industry margin profile, where we look for

c.1ppt-6ppt NPM expansion in 2Q26; Yanker is benefiting from brand/product

upgrades, Weilong on gains from manufacturing efficiency improvement, and

Chacha/Three Squirrel on lower sunflower seed/reduced promotional investment.