Targeting over 20% revenue growth by 2026, can Dpeng Beverage's second growth curve continue its success?

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At the end of March, at the World Superbike Championship (WSBK) Portugal round, Chinese motorcycle brand Zhero Machine won two consecutive SSP category races, breaking the decades-long monopoly held by European, American, and Japanese manufacturers.

Subsequently, the news that Dpeng Beverage sponsored Zhang Xue's motorcycle team with 50,000 yuan spread widely online. Regarding this matter, Jiang Weiwei, Director and Co-President of Dpeng Beverage Group, stated in a media interview that the actual sponsorship amount by Dpeng Energy Drink was much higher than 50,000 yuan. Due to confidentiality agreements, the specific amount has not been disclosed.

During the same period, Dpeng Beverage also released its 2025 annual report. Its revenue reached 20.875 billion yuan, representing a year-on-year increase of 31.8%; net profit attributable to shareholders of the listed company amounted to 4.415 billion yuan, increasing by 32.72% year-on-year.

Despite the dual positive factors of Zhang Xue's motorcycle team winning the championship and revenue growth, Dpeng Beverage's performance in the capital market has not been very optimistic. Year-to-date, the A-share price of Dpeng Beverage has fallen by 22.84%; since its listing on the Hong Kong stock exchange, its Hong Kong stock price has dropped by 16.61%. Why hasn't Dpeng Beverage gained recognition from the capital market?

Deceleration in performance growth

In its financial report, Dpeng Beverage (605499.SH) mentioned that it ranked among the top ten global soft drink brand value lists and placed 44th on Kantar's 2025 list of the most valuable Chinese brands.

Behind these impressive results, Dpeng Beverage is facing underlying concerns. The first issue is the slowdown in performance growth. From 2023 to 2025, the revenue growth rates of Dpeng Beverage were 32.42%, 40.63%, and 31.8%, respectively; while net profit growth rates attributable to shareholders of the listed company were 41.6%, 63.09%, and 32.72%, respectively.

In 2025, the growth rate of Dpeng Beverage slowed significantly, mainly due to noticeable fluctuations in its fourth-quarter performance. According to data from East Money, in Q4 of 2025, Dpeng Beverage’s revenue was 4.031 billion yuan, increasing by 22.88% year-on-year; net profit attributable to shareholders of the listed company was 654 million yuan, growing by 5.66% year-on-year.

Guosen Securities noted that the apparent performance in the fourth quarter faced pressure, primarily due to the postponement of the Spring Festival and the prepayment of refrigerator costs.

According to reports, in 2021, Dpeng Beverage proposed and began implementing its frozen strategy, which was mentioned in that year’s annual report as an assessment indicator for expanding terminal outlets. With the idea that 'freezing is the best display,' the company increased revenue share through enhanced deployment of refrigerators and product displays at the channel level.

In its Hong Kong IPO prospectus, Dpeng Beverage stated that as of September 30, 2025, it had deployed a cumulative total of 400,000 refrigerators. In the next 3-5 years, the company plans to purchase and deploy approximately 600,000 refrigerators across provincial cities nationwide.

In the 2025 annual report, Dongpeng Beverage once again stated that the company is comprehensively accelerating the implementation of its 'Frozen Strategy,' further increasing the scale and intensity of refrigerator deployment at terminal outlets. It is strengthening frozen display support for its '1+6' multi-category development to build a solid physical carrier for high-frequency brand exposure and sales conversion.

The acceleration of refrigerator deployment also increased Dongpeng Beverage's costs. In 2025, Dongpeng Beverage's sales expenses amounted to 3.405 billion yuan, a year-on-year increase of 27%. This was mainly due to a 57.55% increase in channel promotion expenses, primarily from additional refrigerator investments, and a 23.04% rise in employee compensation expenses as the company pushed forward with its nationwide strategy and expanded its sales force.

Additionally, Dongpeng Beverage stated in its financial report that its operating target for 2026 is to achieve revenue growth of no less than 20%. Compared to previous growth rates, Dongpeng Beverage is clearly decelerating on purpose.

Dongpeng Special Drink contributes over 70% of revenue

In terms of product structure, Dongpeng Beverage still relies heavily on the energy drink category.

In 2025, Dongpeng Beverage’s energy drink revenue reached 15.599 billion yuan, an increase of 17.25% year-on-year, with its revenue share dropping from 84.08% in 2024 to 74.78%. Electrolyte drink revenue hit 3.274 billion yuan, surging 118.99% year-on-year, while its revenue share rose from 9.45% to 15.7%. Other drink revenue came in at 1.986 billion yuan, up 94.08%, with its revenue share increasing from 6.47% to 9.52%. The gross profit margins for these three categories were 50.79%, 34.77%, and 15.53%, respectively.

In the energy drink category in 2025, the core product Dongpeng Special Drink generated revenue of 15.599 billion yuan. According to Nielsen IQ data, Dongpeng Special Drink's market share by sales volume in China's energy drink market increased from 47.9% in 2024 to 51.6%, making it the top-selling energy drink in China for the fifth consecutive year. Its national market share by sales value rose from 34.9% to 38.3%, securing first place in both sales volume and sales value, officially claiming the top spot in China’s energy drink market.

From 2022 to 2024, revenue growth rates for energy drinks (Dongpeng Special Drink) were 23.98%, 26.48%, and 28.49%, respectively. The 17.25% growth rate in 2025 shows a significant slowdown compared to previous years. As the category contributing over 70% of Dongpeng Beverage's revenue with the highest gross margin, the slowdown in energy drinks also impacted overall performance.

Electrolyte water serves as Dongpeng Beverage's second growth curve, with the core product 'Hydration+' becoming a blockbuster generating over 3 billion yuan in revenue. However, both its revenue share and gross margin performance still lag significantly behind Dongpeng Special Drink. Meanwhile, under the '1+6' multi-category strategy, Dongpeng Beverage has expanded into tea, coffee, and plant-based protein products, with 'Fruit Tea' and 'Dongpeng Coffee' surpassing 500 million yuan in revenue.

Under its multi-category strategy, Dongpeng Beverage still largely depends on Dongpeng Special Drink to drive revenue. As a fast-moving consumer goods brand, Dongpeng Beverage's growth relies on channel coverage. In the 2025 annual report, the company noted that it had achieved 100% coverage of prefecture-level cities nationwide, working with over 3,400 distributors and more than 4.5 million terminal outlets.

Under these circumstances, it is not easy for Dongpeng Special Drink to achieve further growth. In addition to seeking growth through multi-category strategies, Dongpeng Beverage has started to expand into overseas markets. In its financial report, Dongpeng Beverage stated that it relies on funds raised from the Hong Kong stock market to expand its overseas business, focusing on the Southeast Asian market to promote the brand's global development.

According to the Hong Kong stock prospectus, Dongpeng Beverage plans to use 8% of the net proceeds from fundraising to establish supply chain infrastructure, including warehousing, in key overseas markets. This is aimed at meeting the high-growth demands of regions such as Southeast Asian countries like Indonesia, Vietnam, and Malaysia, with the ultimate goal of achieving localized operations. The company may selectively extend upstream along the industrial chain, deepen partnerships, and support its overseas business by sourcing raw materials locally.

Approximately 12.0% of the net proceeds will be used to expand overseas market operations over the next three to five years, exploring potential investment and merger and acquisition opportunities. The company will continue to actively explore overseas market development opportunities, adopting flexible business models tailored to local market characteristics. In the short term, the focus will be on the Southeast Asian market, while gradually expanding efforts to other markets such as the United States in the medium to long term.

Currently, revenue from overseas markets contributes little to Dongpeng Beverage’s overall income. In 2025, revenue from other regions, including online, overseas, and food service channels, amounted to 7.4 billion yuan, accounting for only 3.55% of total revenue. However, with more funding directed towards overseas markets, there is hope for increased income.

Now, Dongpeng Beverage has completed its A+H share listing, securing additional funding. However, whether it can dispel capital market concerns about its “growth peak,” hinges not on temporary earnings fluctuations but on whether its second growth curve can truly take over and whether its overseas expansion can open up new opportunities.

Author | Wu Ren

Source | Zhengtan Finance (ID: teccj6)

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