Deutsche Bank has initiated coverage of Chagee (CHA) with a Buy rating and set a price target of $40.50, highlighting the milk tea brand’s dominant role in China’s rapidly expanding tea industry.
According to the bank’s research note, the number of stores offering freshly made tea beverages has surged six-fold from 2019 to 2024, with Chagee leading the charge as China’s largest premium milk tea company.
The firm praises Chagee’s strong brand equity and continuous product innovation, which have helped the company maintain a well-protected premium market position.
Deutsche Bank also commends Chagee’s steady pace of store openings nationwide, supporting its growth in a competitive yet flourishing sector.
As the demand for high-quality milk tea continues to soar, Chagee’s robust presence and innovative approach position it well for investors looking to tap into China’s vibrant tea market.
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