CLSA has released a research report stating that China's food delivery market has entered a mature phase, with platform competition remaining intense and subsidy wars frequent.

Although order volumes have been boosted, profit margins for restaurant companies are being further squeezed.

As subsidies recede, companies with scalable business models and strong single-store profitability are poised to become market winners.

CLSA has initiated coverage on DPC DASH (01405) with an "Outperform" rating and a target price of HK$49.

In its report, CLSA notes that DPC DASH is the master franchisee for Domino's Pizza in China, inheriting the brand's extreme emphasis on delivery quality and brand value.

Among the restaurant companies covered by CLSA, it is the only one with its own in-house delivery team.

Relying on core markets like Beijing and Shanghai, its self-built delivery system not only ensures service stability but also effectively helps the brand build a loyal member user base.

New stores in second-tier cities have now become the company's core growth engine, accounting for 61% of its total store count as of 2025, with this proportion still rising.

Compared to its peers, DPC DASH currently has a smaller store base, indicating the company possesses more substantial long-term store expansion potential.

CLSA's calculations show that DPC DASH has the potential to open a total of 3,572 stores across first and second-tier cities, pointing to broad medium- to long-term growth prospects.