Guangzhou Restaurant (603043): Proposed acquisition of Tao Taoju Qiangqiang combines Cantonese classics to strengthen brand strength

Event: The company and Guangzhou Industrial Development Group Co., Ltd. signed a Letter of Intent for Equity Transfer. The company intends to transfer its 100% equity interest in Guangzhou Taotaoju Food Co., Ltd.

Finally, as of September 30, 2018, Taotaoju’s asset budget was 9186.

70,000 yuan, net assets of 5048.

40,000 yuan, the first three quarters of 18 years to achieve revenue 6463.

130,000 yuan (accounting for 3 of the Guangzhou restaurant in the same period).

2%) and a net profit of 830.

80,000 yuan (accounting for 2 of the Guangzhou restaurant in the same period).


Core point of view The two old Cantonese food brands have been combined to strengthen the brand strength.

1) Tao Taoju and Guangzhou Restaurant merged Guangzhou Cantonese cuisine with a long history and outstanding brand power.

After the completion of the transaction, Tao Taoju will become a subsidiary of Guangzhou Restaurant. The two major Cantonese classic brands will realize a strong alliance, play a synergistic effect, continue to focus on the “food + catering” main business, and further strengthen the brand strength; 2) Tao TaojuThe main business of Food Co., Ltd. includes food sales, property rental, external brand authorization, etc.

From the information on the Tmall platform, Tao Taoju mainly sells Cantonese dim sum such as egg yolk cakes, wife cakes, egg rolls, etc., which can further enrich and improve the product matrix of Guangzhou Restaurant, and consolidate Cantonese wine on the top of the Cantonese noodle market;3) Guangzhou Restaurant and Tao Taoju are both affiliated enterprises of the State-owned Assets Supervision and Administration Commission of Guangzhou Municipality. This acquisition is another major achievement of the reform of state-owned enterprises in Guangzhou. As the sole catering listing platform of the State-owned Assets Supervision and Administration Commission of Guangzhou Municipality, Guangzhou Restaurant is expected to become the main force in the reform of state-owned enterprises in Guangzhou.Follow-up does not rule out the possibility of continuing to integrate other catering assets.

Q2 e-commerce sales performed well, and sales were good.

Through our tracking of online store data, from April to May 19th, Guangzhou restaurant flagship store opened at a three-digit growth rate. Online store sales have been outstanding, and the contribution of e-commerce channels to revenue is gradually increasing.At present, the company’s sales situation is very good, and Q2 is expected to continue its good performance.

We are still optimistic about the expansion of Cantonese classics: 1) The company’s growth path is clear, and the three expansion leaps have confirmed that the company has excellent management capabilities; 2) The company is in the golden period of development, the main product funding is sought, and the production capacity is stillThe core factors driving the company’s performance growth.

Financial forecasts and investment recommendations maintain a BUY rating with a target price of 38.

76 yuan.

It is expected that the eps for 19-21 will be 1.



73 yuan, based on the comparable company evaluation method, giving the company a 34-year PE estimate for 19 years, corresponding to a 都市夜网 target price of 38.

76 yuan.

Risk Warning Food Safety, Investment Project Construction Is Less Than Expected, Market Competition Risk