Daily focus：Yum China（9987）
Yum China delivered a steady performance in the second quarter of 2025, with revenue reaching 2.79 billion USD, a year-on-year increase of 4%. Core operating profit was 303 million USD, up 14.3%, and adjusted net profit was 215 million USD, slightly rising by 1% compared to the same period last year. Same-store sales grew by 1%, and system sales increased by 4%, with KFC system sales up 5% and Pizza Hut sales up 3%. Delivery revenue accounted for 45% of total revenue. Despite the competitive delivery subsidy environment, order volume significantly increased, and the company maintained an overall improvement in restaurant profitability through operational efficiency and cost control. The restaurant profit margin reached 16.1%, up 0.6 percentage points year-on-year. Additionally, the company rapidly expanded its store network, adding a net 336 stores in Q2, with a full-year store opening target unchanged at 1,600 to 1,800 stores. The proportion of franchised stores continued to rise as the company pushed forward its franchise strategy.
China export better than expected
China’s July export data performed unexpectedly strong, with exports rising 7.2% year-on-year in US dollar terms, far exceeding market expectations of 5.6%, while imports grew 4.1%, also better than anticipated. ASEAN has emerged as China’s largest trading partner, with July exports to ASEAN surging 16.59%, while exports to the United States fell 21.67%, reflecting a restructuring of trade patterns. Mechanical and electrical products continue to dominate exports, with integrated circuits posting significant growth of 21.8%. Private enterprises performed exceptionally well, accounting for 57.1% of total foreign trade value in the first seven months.
The Hong Kong Stock Connect recorded a net inflow of HKD 660 million on Thursday, with Xiaomi Corporation (1810) having the largest net inflow, reaching HKD 1.72 billion, followed by Semiconductor Manufacturing International Corporation (SMIC) (981). The Tracker Fund of Hong Kong (2800) recorded the largest net outflow, amounting to HKD 4.72 billion, followed by Pop Mart (9992).
The Hang Seng Index closed the day at 24,858 points, down 222 points or 0.9%; the China Enterprises Index fell 86 points or 0.9% to 8,895 points; the Hang Seng Tech Index dropped 86 points or 1.5% to 5,460 points. The total market turnover for the day was approximately HKD 206.7 billion. In terms of individual performance, Wharf Real Estate Investment Company (1997) saw its investment property impairment losses widen to HKD 2.4 billion, causing its share price to plunge 8%; Semiconductor Manufacturing International Corporation (981) reported a 19.5% year-on-year decline in net profit for the second quarter, with its stock price dropping 8.2%; CSPC Pharmaceutical Group (1093) rose 6% against the market trend; China Unicom (762) shares climbed 2.4%.
Source: KGI Investment Products and Solutions Department
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