“Africa’s Diaper King” Accelerates Again: Locsott’s Sales and Prices Both Rise in the First Half of the Year

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Africa’s leading diaper company, Leshi Comfort, has continued its rapid growth after going public.

On July 21, Leshi Comfort released a positive earnings forecast, expecting revenue for the first half of 2026 to be no less than $328 million, a year-on-year increase of at least 28%, and profit no less than $73 million, a year-on-year increase of at least 40%.

In 2025, Leshi Comfort achieved revenue of $567 million, a year-on-year growth of 24.9%, and profit of $121 million, a year-on-year growth of 27.4%. According to the forecast, the company’s revenue and profit growth in the first half of this year have both accelerated compared to last year as a whole.

Leshi Comfort mainly targets the markets of Africa, Latin America, and Central Asia, selling baby diapers, pull-up pants, sanitary pads, and wet wipes.

Based on 2024 sales, Leshi Comfort ranks first in Africa’s baby diaper and sanitary pad markets, with market shares of 20.3% and 15.6% respectively.

This year’s first half revenue growth was mainly driven by both increased sales volume and higher average prices.

Leshi Comfort continues to deepen its sales channels and optimize production layout, exporting products from core markets like East and West Africa to neighboring countries, while also expanding its presence in the Latin American market to drive overall sales growth.

The increase in average selling price was noticeably influenced by exchange rates: compared to the same period last year, local currencies such as the Ghanaian cedi, Zambian kwacha, West African CFA franc, and Central African CFA franc all strengthened against the US dollar, raising product prices when calculated in dollars.

Profit growth was mainly driven by expanded sales scale, increased bank interest income, and reduced listing expenses, but was partially offset by exchange losses. Excluding listing expenses and exchange gains/losses, Leshi Comfort still expects adjusted net profit in the first half of the year to grow by at least 47%.

Africa remains the fundamental revenue base for Leshi Comfort.

In 2025, East Africa, West Africa, and Central Africa contributed 45.1%, 40.7%, and 10.2% of company revenue respectively, totaling 96%. On the product side, business mainly relies on baby care, which accounts for 78.6% of revenue.

Several securities firms summarize Leshi Comfort's growth in Africa as stemming from low market penetration, localized production, and deep distribution. The company lowers costs by building factories locally, global sourcing, and penetrating channels, thus forming a price advantage over international brands.

The next focus is to replicate this model outside Africa.

Southwest Securities believes Leshi Comfort is adopting an “trade first, build later” expansion path, initially validating demand via exports and channels, then using local production to reduce tariffs, shipping costs, and delivery times. Latin American markets such as Peru and El Salvador may become the second growth curve, but whether new production can be released on schedule and whether local channels can match the depth of coverage in Africa remain to be seen.

Leshi Comfort is also reserving funds to expand production. The company raised a net HKD 2.229 billion from its IPO, of which HKD 1.835 billion is planned to be used for capacity expansion and production line upgrades, and had not been used by the end of 2025, with plans to be fully utilized before the end of 2029.

As its operational region expands, exchange rate risks associated with multiple currencies become more prominent. In June this year, Leshi Comfort signed three forward foreign exchange contracts, selling a total of 29.9 million euros and buying 34.694 million US dollars to hedge exchange rate fluctuations in its foreign currency assets.

In addition to currency fluctuations, Leshi Comfort must also deal with risks such as raw material price volatility, increasing complexity in cross-border management, and intensifying market competition. Whether additional capacity can be absorbed by real demand will also determine whether its Latin American expansion can replicate African market growth.

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