CMSC has raised its rating on HAIDILAO (06862) from "Neutral" to "Accumulate", citing an attractive risk-reward profile driven by a favorable valuation entry point and robust shareholder returns. The stock currently trades at 13.8 times forward 2027 mid-term earnings, a two-year low, which the brokerage views as a prime window to position for the company's long-term fundamental recovery.

A high dividend yield provides a solid downside cushion, while the acceleration of multi-brand expansion is back on track. In light of these factors, CMSC has slightly raised its 2026-2027 revenue forecasts by an average of 1%, reflecting increased contributions from delivery services and new brand revenue. However, due to short-term promotional spending and higher raw material costs, the brokerage has trimmed its net profit estimates for the two years by 2.5%. The target price has been adjusted downward from HK$16 to HK$14.4.

The company delivered steady results for the first half of 2026, signaling a clear inflection point in operations. Revenue grew 7.9% year-on-year to RMB 22.3 billion, reaching the upper end of the brokerage's forecast range. Net profit slightly missed expectations, weighed down by gross margin pressure from intensified promotional activities. Nevertheless, CMSC believes this margin compression stems from proactive investment—a necessary step to consolidate market share and boost store traffic.

More notably, management surprised to the upside by declaring an interim dividend of HK$0.377 per share, representing a payout ratio of nearly 100%. This reflects management's confidence in the company's strong cash generation capabilities and long-term operational fundamentals.