Lyon: The Wahaha share dispute may be beneficial to NONGFU SPRING (09633) and CR BEVERAGE (02460).

A report released by Lyon stated that a family dispute broke out among the family of the late founder of Wahaha, Zong Qinghou, which may affect the group's product sales and market share. Meanwhile, competitors NONGFU SPRING (09633) and CR BEVERAGE (02460) are expected to benefit from the situation, as their market shares are rapidly increasing. Starting from March, NONGFU SPRING was listed as the top pick stock, with a strong outlook for business recovery, giving it a "highly confident to outperform the market" rating, with a target price of 45 Hong Kong dollars. The report believes that CR BEVERAGE's stable sales of bottled water this year and expanding profit margins remain its main growth drivers, also giving it an "outperform the market" rating, with a target price of 17.7 Hong Kong dollars. The report pointed out that Wahaha's negative impact on Zong Qinghou's public image and company governance may lead to a change in consumer preferences. Channel data shows that Wahaha's online sales of bottled water have significantly decreased, with average daily sales falling to 75,000 to 100,000 RMB in the first week of July, and dropping to 25,000 to 50,000 RMB on July 18th and 19th. In comparison, NONGFU SPRING has recorded strong double-digit growth in bottled water sales since March this year, and its market share is expected to gradually recover, while CR BEVERAGE may also benefit from this situation.