HUABAO INTL (00336) saw its shares rise more than 11% during afternoon trading. At the time of writing, the stock was up 8.31%, trading at HKD 4.43, with a turnover of HKD 40.29 million.

The company announced its annual results, reporting group revenue of RMB 3.485 billion, a year-on-year increase of 3.30%. Gross profit was RMB 1.423 billion, a slight decrease of 1.27% compared to the previous year.

Analysts noted that while the company's domestic tobacco flavoring business continues to contract due to China Tobacco's "self-sufficiency" policy, this negative factor has been fully anticipated. The company's forward-looking overseas production capacity construction is now entering a harvest phase. Tobacco raw material businesses, particularly crackling capsules and HNB sheets, are emerging as new growth engines. Overseas sales in this segment showed significant year-on-year growth in the first half of 2025, driving overall revenue growth against the trend.

Simultaneously, the domestic non-tobacco business continues to expand, reducing reliance on major clients. A subsidiary, HUABAO Shares, returned to profitability in 2025. Looking ahead to 2026, the impact of declining domestic orders is expected to gradually diminish. Overseas orders for crackling capsules and HNB sheets are anticipated to scale up rapidly, driving substantial growth in both revenue and profit.