Goldman Sachs maintains Guming Holdings at Buy (on Conviction List), target price HK$36.00

Overview

This report summarizes Goldman Sachs' key takeaways after attending Guming's 2026 Hangzhou Partner Conference. The company's strategic priorities this year include improving the dine-in experience, enhancing store network quality and continuing category expansion. Goldman Sachs maintains a Buy (on Conviction List) rating on Guming Holdings, with a 12-month target price of HK$36.00 based on 23x 2026E P/E.

Core views

Goldman Sachs' core view is that Guming faces near-term same-store sales pressure from a high base, weather disruptions and normalization of delivery subsidies, but continues to outperform the industry. In the medium term, better store quality, improved dine-in contribution, coffee growth, breakfast occasion expansion and ongoing launch of hit products should support same-store sales and profitability. The company will place greater emphasis on store location, size, appearance, franchisee operating involvement and centralized operational support, rather than relying solely on aggressive promotions.

Analysis framework

The report primarily analyzes management commentary from the company's partner conference, recent operating trends, category strategy, store network quality, same-store sales performance, valuation multiples and Goldman Sachs' internal coverage framework. Valuation uses a 2026E P/E multiple method, with the HK$36.00 target price corresponding to 23x 2026E P/E.

Methodology notes

• Valuation methodsP/E valuation method

  23x 2026E P/E

  Goldman Sachs uses a 23x 2026E P/E multiple as the basis for Guming Holdings' target price, resulting in a 12-month target price of HK$36.00.

• Style factorsGS Factor Profile

  Growth, Financial Returns, Multiple, Integrated

  Goldman Sachs uses growth, financial returns, valuation multiple and integrated factors to assess each stock's percentile performance relative to its Asia ex-Japan coverage universe and Greater China retail peers; the chart shows Guming's growth dimension is near the high percentile versus Greater China retail peers.

• Event and strategyPartner conference takeaways analysis

  Management's strategic priorities and operating levers

  The report reviews management's latest strategy across dine-in, store quality, coffee, breakfast, new markets, marketing and brand upgrades, and evaluates the impact on same-store sales and profitability.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• Guming Holdings Ltd. (1364.HK)

  Core coverage name

  Strengths

  Buy (on Conviction List) rating; 54.9% upside to current price; coffee, breakfast and store upgrades provide growth levers; improved new-store quality.

  Weaknesses

  Near-term same-store sales are slowing under a high base, profit growth has been under pressure since 2Q, and dine-in improvement still needs time.

  Comparison

  Management said recent performance remains better than the industry; the GS Factor Profile shows a relatively high growth percentile versus Greater China retail peers.

  Risks

  Store network management, slower-than-expected store openings, store productivity, intensifying competition, price wars, rising costs, higher subsidies to franchisees, weaker scale economics from geographic expansion, and food safety.

• Hang Seng Index

  Market reference index

  Strengths

  Used for relative stock performance and historical price chart comparison.

  Weaknesses

  Does not directly reflect company fundamentals.

  Comparison

  The report's charts compare 1364.HK's share price with the Hang Seng Index.

  Risks

  Overall Hong Kong market volatility may affect valuation and trading sentiment.

Key data

• Ticker1364.HKGuming Holdings' Hong Kong listing code.
• 12-month target priceHK$36.00Goldman Sachs target price, based on 23x 2026E P/E.
• Current share priceHK$23.24Price disclosed in the report.
• Implied upside54.9%Upside versus the current share price.
• Market capitalizationHK$55.3bn / US$7.1bnKey data disclosed in the report.
• Enterprise valueHK$45.9bn / US$5.9bnKey data disclosed in the report.
• 3-month average daily turnoverHK$146.8mn / US$18.8mnKey data disclosed in the report.
• Current average daily coffee sales per storeAbout 90 cupsFurther improved from about 80 cups at the end of 2025.
• Coffee sales mix target20% in 2026, 25% thereafterManagement target.
• Breakfast trial stores>1400 storesMainly in Guangdong and Guangxi, testing hot breakfast offerings.
• Average daily breakfast GMV contribution>Rmb200Average daily contribution from trial stores without brand promotions.
• Marketing spend planRmb400mnConsistent with Goldman Sachs' estimates, including spokesperson and IP collaborations.

Impact & implications

The report's investment implication for Guming Holdings is moderately positive: although same-store sales are under pressure near term from a high base and weather factors, if coffee, breakfast, HPP and hit new products continue to scale, while improved store quality brings stronger operating efficiency, the recent pullback in the share price may present an accumulation opportunity. At the industry level, after delivery subsidies normalize, competition among tea beverage brands may shift from subsidy-led growth to dine-in experience, product strength, store quality and brand building.

Risks

• Inability to effectively manage a large store network.
• Store expansion falling short of expectations.
• Store productivity underperforming expectations.
• Intensifying competition, shifting consumer trends, and price wars.
• Rising store-level costs.
• Higher-than-expected subsidies to franchisees.
• Scale-economy dilution from geographic expansion.
• Food safety issues.
• Weather disruptions and a high base may continue to weigh on near-term same-store sales.

What to watch

• Whether 2Q-3Q same-store sales declines under a high base are in line with management and Goldman Sachs expectations.
• Whether average daily coffee sales per store can continue to rise, and whether the sales mix can reach 20% and move toward 25%.
• Whether the breakfast hot-food trial can be replicated from more than 1,400 stores in Guangdong and Guangxi to other regions.
• Whether new-store quality, store location, size and appearance upgrades continue to outperform the existing store base.
• The pace of entry into Nanjing and higher-tier cities, as well as progress on overseas expansion preparation.
• The monthly launch cadence of hit products and their impact on traffic, basket size and same-store sales.
• The intensity of industry competition and price pressure after delivery subsidy normalization.
• The effectiveness of the Rmb400mn marketing spend in translating into brand awareness, store image and repeat purchases.