Investment Rating - The report maintains a "Buy" rating for the company, with a market price of HKD 17.98 [1]. Core Insights - The company is experiencing steady revenue growth driven by the expansion of its store and user base, with a reported revenue of HKD 7.1 billion for the first half of 2024, representing a year-on-year increase of 9.3% [3]. - The company has added 402 factory stores, bringing the total to 6,311, and has registered 126 million users, a 20.7% increase year-on-year [3]. - The adjusted net profit for the first half of 2024 is HKD 358 million, up 67.3% year-on-year, with a gross margin of 25.9%, reflecting an improvement due to the continuous enhancement of proprietary controlled products [3]. - The report anticipates revenue growth for 2024-2026 to be HKD 146 billion, HKD 160 billion, and HKD 179 billion, with corresponding year-on-year growth rates of 7%, 10%, and 12% respectively [4]. - The net profit projections for the same period are HKD 720 million, HKD 1.07 billion, and HKD 1.37 billion, with year-on-year growth rates of -89%, +49%, and +28% respectively [4]. - The company is expected to benefit from the optimization of the third-party market structure, which will enhance its performance stability and valuation [4]. Financial Summary - Revenue for 2022 was HKD 11.563 billion, with a projected increase to HKD 17.934 billion by 2026, reflecting a compound annual growth rate (CAGR) of approximately 12% [1]. - The net profit for 2022 was a loss of HKD 2.136 billion, expected to recover to HKD 1.37 billion by 2026 [1]. - Earnings per share (EPS) are projected to rise from a loss of HKD 2.63 in 2022 to HKD 1.69 by 2026 [1]. - The price-to-earnings (P/E) ratio is expected to improve from -6.2 in 2022 to 9.7 by 2026 [1].

Investment Rating - The investment rating for the company is "Buy" and is maintained [1][7]. Core Views - The company has shown resilience against the consumer environment, with a revenue of 7.126 billion and a year-on-year growth of 9.3% for the first half of 2024. The adjusted net profit reached 358 million, reflecting a significant year-on-year increase of 67.3% [4][7]. - The company is focusing on long-term growth by controlling the pace of store expansion and enhancing operational efficiency through a diversified service offering [5][6]. - The company has achieved a user repurchase rate of 61.1%, indicating strong customer satisfaction and loyalty [5][7]. Financial Performance - For the first half of 2024, the company achieved a gross margin of 25.9%, up 1.7 percentage points year-on-year, driven by scale effects and improvements in product and business structure [4][7]. - The company expects revenues of 14.787 billion, 16.846 billion, and 18.917 billion for the years 2024, 2025, and 2026 respectively, with corresponding net profits of 543 million, 997 million, and 1.449 billion [8][9]. - The projected earnings per share (EPS) for the years 2024, 2025, and 2026 are 0.67, 1.23, and 1.78 respectively, with price-to-earnings (P/E) ratios of 24, 13, and 9 [8][9]. Business Strategy - The company is expanding its service categories and enhancing operational capabilities based on a high repurchase rate, which is expected to drive steady revenue growth [7]. - The company has increased its store count to 6,311, with a net addition of 402 stores in the first half of 2024, reflecting a commitment to improving service quality and customer experience [5][6]. - The company has launched high-cost performance tire products in collaboration with manufacturers, achieving sales of over 1.5 million self-controlled tires in the first half of 2024 [6].

Investment Rating - Buy rating maintained for the company [1] Core Views - The company achieved revenue of 7.126 billion in 24H1, a year-on-year increase of 9.3%, with adjusted net profit of 358 million, up 67.3% year-on-year, and adjusted net profit margin of 5.0%, up 1.2 percentage points quarter-on-quarter [4] - The company's gross profit margin reached 25.9% in 24H1, up 1.7 percentage points year-on-year, benefiting from scale effects and product/business structure improvements [4] - The number of workshop stores reached 6,311 by 24H1, a net increase of 402 from the end of the previous year, with a user repurchase rate of 61.1% as of June 2024 [5] - The company expanded its service categories, with over 5,300 workshop stores nationwide equipped with car washing capabilities by June 2024 [6] - Revenue for 2024/25/26 is projected to be 14.787/16.846/18.917 billion, with net profit attributable to the parent company expected to be 543/997/1,449 million, corresponding to a PE ratio of 24/13/9 times [7] Business Performance - Revenue from tire and chassis parts/car maintenance/advertising, franchise, and other businesses increased by 11%/11%/4% respectively in 24H1, with gross profit margins for tire and chassis parts/advertising, franchise, and other businesses improving [4] - The company's proprietary and self-controlled products accounted for an increasing proportion of revenue in 24H1, driven by product strategies aligned with consumer trends [4] - The company sold over 1.5 million self-controlled tires produced by Double Star and Double Coin in 24H1, and its proprietary maintenance brand covered 30 categories, with 21 million products sold by June 2024 [6] Financial Projections - Revenue growth rates for 2024/25/26 are projected at 9%/14%/12%, with net profit growth rates of -92%/83%/45% [8] - Gross profit margins are expected to be 25.75%/27.07%/28.27% for 2024/25/26, with net profit margins of 3.68%/5.92%/7.66% [9] - ROE is projected to be 10.84%/16.57%/19.39% for 2024/25/26, with ROIC at 8.20%/13.95%/16.38% [9] Operational Metrics - The company's asset-liability ratio is expected to decrease from 60.52% in 2024 to 57.05% in 2026 [9] - The current ratio is projected to improve from 1.32 in 2024 to 1.53 in 2026, with the quick ratio increasing from 0.78 to 1.01 over the same period [9] - Total asset turnover is expected to remain stable at around 1.2-1.3 times from 2024 to 2026 [9]

Investment Rating - The investment rating for the company is "Buy" (maintained) [2][3][11] Core Insights - The company continues to enhance its profitability and solidify its position as the largest independent automotive service platform in China, achieving a revenue of 7.126 billion yuan in the first half of 2024, a year-on-year increase of 9.3%, and an adjusted net profit of 358 million yuan, a year-on-year increase of 67.3% [3] - The company has expanded its store network significantly, with a total of 6,311 stores as of the first half of 2024, an increase of 402 stores compared to the end of 2023, with over 58% of the new stores located in lower-tier cities [4] - The gross profit margin for automotive products and services improved by 1 percentage point compared to the first half of 2023, with tire gross margin increasing by 1.5 percentage points to 17.5% and car wash and beauty services gross margin increasing by 5.7 percentage points to 18.8% [4] Financial Summary and Valuation Metrics - For the fiscal years 2022 to 2026, the projected revenue and net profit figures are as follows: - 2024E Revenue: 14.698 billion yuan, YOY growth of 8.1% - 2024E Net Profit: 511 million yuan, YOY decline of 92.4% - 2024E Gross Margin: 26.1% [5] - The earnings per share (EPS) for 2024 is projected to be 0.62 yuan, with a price-to-earnings (P/E) ratio of 25.9 times [5][6]

Investment Rating - The investment rating for the company is "Buy" (maintained) [2][3] Core Insights - The company continues to enhance its profitability and solidify its position as the largest independent automotive service platform in China, achieving a revenue of 7.126 billion yuan in the first half of 2024, a year-on-year increase of 9.3%, and an adjusted net profit of 358 million yuan, a year-on-year increase of 67.3% [3] - The company has expanded its store network significantly, with a total of 6,311 stores nationwide as of the first half of 2024, reflecting a strategic focus on lower-tier cities where over 58% of new stores are located [4] - The gross profit margin for automotive products and services improved by 1 percentage point compared to the first half of 2023, with tire gross margin increasing by 1.5 percentage points to 17.5% and car wash and beauty services gross margin rising by 5.7 percentage points to 18.8% [4] Financial Summary and Valuation Metrics - For the fiscal years 2022 to 2026, the company is projected to have the following financial metrics: - Revenue (in million yuan): 11,547 (2022), 13,601 (2023), 14,698 (2024E), 15,850 (2025E), 16,946 (2026E) [5] - Net Profit (in million yuan): -2,136 (2022), 6,703 (2023), 511 (2024E), 810 (2025E), 1,036 (2026E) [5] - Gross Margin (%): 19.7 (2022), 24.7 (2023), 26.1 (2024E), 27.0 (2025E), 27.5 (2026E) [5] - EPS (in yuan): -2.61 (2022), 8.19 (2023), 0.62 (2024E), 0.99 (2025E), 1.26 (2026E) [5] - P/E Ratios: 25.9 (2024E), 16.3 (2025E), 12.8 (2026E) [5] Market Position and Strategy - The company has maintained its leading position in the automotive service sector, with a total of 21.4 million active users over the past 12 months, reflecting an 18.8% year-on-year growth [3] - The strategic focus on cost-effective products and services is expected to drive further improvements in gross margins, as consumer preferences shift towards higher value offerings [4]

Investment Rating - The report maintains a "Recommend" rating for Tuhu-W (09690 HK) with a target price of HKD 24 [1] Core Views - Tuhu-W achieved revenue of RMB 7 13 billion in H1 2024, a YoY increase of 9 3%, with gross profit of RMB 1 85 billion, up 17% YoY, and a gross margin of 25 9%, up 1 7 percentage points YoY [1] - Adjusted EBITDA reached RMB 450 million, up 28% YoY, with an EBITDA margin of 6 3%, up 0 9 percentage points YoY [1] - Adjusted net profit was RMB 360 million, a YoY increase of 67%, with an adjusted net profit margin of 5 0%, up 1 7 percentage points YoY [1] - The company added 402 new stores in H1 2024, with over 60% located in lower-tier cities, bringing the total number of workshops to 6,311, a 23% YoY increase [1] - Registered users reached 126 million, up 21% YoY, with 21 4 million transacting users, up 19% YoY, and a user penetration rate of 17% [1] - The average monthly active users (MAU) of the Tuhu app reached 11 5 million, with a repurchase rate of 61 1% among transacting users [1] Store Expansion and User Growth - Tuhu-W added 402 new stores in H1 2024, with over 60% located in lower-tier cities, bringing the total number of workshops to 6,311, a 23% YoY increase [1] - The company's self-operated stores decreased by 3, while franchise stores increased by 405, outperforming the industry average, which saw a contraction of 2,000 traditional 4S stores [1] - The company expects to open 1,000 new stores in 2024, with franchise applications up 22% YoY and store setup time reduced to 27 days [1] - Registered users reached 126 million, up 21% YoY, with 21 4 million transacting users, up 19% YoY, and a user penetration rate of 17% [1] Financial Performance - Revenue from automotive products and services reached RMB 6 6 billion, up 9 6% YoY, with tire and chassis components contributing 42% of total revenue [1] - Car maintenance revenue was RMB 2 6 billion, up 11% YoY, contributing 37% of total revenue [1] - Other products and services revenue was RMB 380 million, up 4% YoY, with self-controlled and exclusive products accounting for 71 7% of total revenue, up 3 4 percentage points YoY [1] - The company's gross margin for tire and chassis components increased by 2 percentage points [1] Valuation and Forecast - The report forecasts adjusted net profit for 2024-2026 to be RMB 725 million, RMB 939 million, and RMB 1 17 billion, respectively, with a target price of HKD 24 based on a 25x PE multiple for 2024 [1] - The company's revenue growth is expected to be 8 0% in 2024, 8 6% in 2025, and 8 5% in 2026 [2] - Adjusted net profit growth is projected at 51% in 2024, 30% in 2025, and 25% in 2026 [2] Market Position and Competitive Advantage - Tuhu-W's competitive landscape is better than its overseas peers, with a strong presence in lower-tier cities and a high user repurchase rate [1] - The company's self-controlled and exclusive products account for 71 7% of total revenue, up 3 4 percentage points YoY, driving gross margin improvements [1] - Tuhu-W's MAU in transacting users contributes 54%, with a repurchase rate of 61 1%, indicating strong user loyalty [1]

Investment Rating - The report maintains a "Buy" rating for the company with a target price of HKD 24.00, indicating a potential upside of 38.2% from the current closing price of HKD 17.36 [1][7]. Core Insights - The company's mid-2024 performance met expectations, with an anticipated revenue growth of 8% year-on-year to RMB 14.7 billion and an adjusted net profit of RMB 730 million, corresponding to a net profit margin of 5% [1][5]. - The report highlights that while consumer demand for cost-effectiveness is pressuring average transaction values, the trend of improving profit margins remains intact. The company is focusing on expanding its factory store network and optimizing its product mix to increase the share of high-margin proprietary and self-controlled products, which currently account for approximately 70% of sales [1][4]. - The company has made significant progress in its store expansion, with a total of 6,311 factory stores as of June 30, 2024, an increase of 402 stores from the end of 2023, with over 60% of new stores located in lower-tier cities [1][5]. Financial Summary - For the first half of 2024, the company reported revenue of RMB 7.1 billion, a year-on-year increase of 9.3%, with a gross margin improvement of 1.7 percentage points to 26% [1][5]. - The adjusted net profit for the first half of 2024 was RMB 360 million, reflecting a 67% year-on-year increase, maintaining a net profit margin of 5% [1][5]. - The report projects revenue growth for 2024E at RMB 14.7 billion, with gross profit expected to reach RMB 3.9 billion, resulting in a gross margin of 26.4% [4][8].

Investment Rating - The investment rating for the company is "Buy" (maintained) [1][3] Core Views - The company reported a significant year-on-year growth in performance for H1 2024, with total revenue reaching 7.1 billion yuan, an increase of 9.3% compared to the previous year. Adjusted net profit was 358 million yuan, up 67.3% year-on-year [3] - The expansion of the store network and the increase in product categories have driven revenue growth. The company optimized online promotion and expanded its workshop store network, reaching 6,311 stores nationwide, with 402 new stores added. This expansion increased the revenue from tires and chassis components from 5 billion yuan in H1 2023 to 5.6 billion yuan in H1 2024, a growth of 10.9% [3] - The company has also introduced more services such as car cleaning and beauty at its workshop stores, which, along with a membership card program, has contributed to increased revenue from other products, rising from 364 million yuan in H1 2023 to 380 million yuan in H1 2024, a growth of 4.3% [3] - The revenue structure optimization has led to a continuous increase in gross margin, which was 25.9% in H1 2024, up 1.7 percentage points year-on-year. This improvement is attributed to better terms from suppliers, increased contribution from proprietary and self-controlled products, and a reduction in low-margin electric vehicle sales [3] Financial Projections - The company is expected to achieve revenues of 14.64 billion yuan, 16.20 billion yuan, and 17.95 billion yuan for the years 2024, 2025, and 2026, respectively. The net profit attributable to the parent company is projected to be 700 million yuan, 1.09 billion yuan, and 1.56 billion yuan for the same years. The corresponding price-to-earnings ratios (PE) are expected to be 19.13, 12.29, and 8.60 times [3][6]

Investment Rating - The investment rating for the company is "Buy" [7][10]. Core Views - The company is expected to achieve steady revenue growth with projected revenues of 14.86 billion, 16.25 billion, and 17.83 billion CNY for 2024, 2025, and 2026, respectively, corresponding to growth rates of 9.3%, 9.4%, and 9.7% [10][11]. - Adjusted net profits are forecasted to be 768 million, 1.18 billion, and 1.62 billion CNY for the same years, with growth rates of 59.6%, 53.8%, and 37.1% [10][11]. - The adjusted EPS is projected to be 0.95, 1.45, and 1.99 CNY per share for 2024, 2025, and 2026, respectively [10][11]. - The adjusted PE ratios are expected to be 17.0x, 11.0x, and 8.0x for the years 2024 to 2026 [10][11]. Summary by Sections Financial Performance - In H1 2024, the company reported revenue of 7.13 billion CNY, representing a year-on-year increase of 9.3%, and an adjusted net profit of 360 million CNY, up 67.3% year-on-year [10][11]. - The number of transaction users reached 21.4 million, an increase of 18.8% year-on-year, and the total number of Tuhu workshop stores grew to 6,311, with 402 new stores added since the end of 2023 [10][11]. Revenue Breakdown - Revenue from tires and chassis components, automotive maintenance, and other automotive products and services showed year-on-year growth rates of 11.0%, 10.7%, and 4.3%, respectively [10][11]. - The growth in the automotive maintenance segment was slightly lower due to macroeconomic influences, while the automotive beauty business was a significant growth driver for other automotive products and services [10][11]. Profitability - The company achieved a comprehensive gross margin of 25.9% in H1 2024, an increase of 1.7 percentage points year-on-year [11]. - The gross margins for various segments were as follows: tires and chassis components (+1.5 percentage points), automotive maintenance (-0.6 percentage points), and other automotive products and services (+5.5 percentage points) [11]. - The adjusted net profit margin improved to 5.0%, up 1.7 percentage points year-on-year, due to enhanced internal management efficiency [11].

Investment Rating - The report maintains a "Buy" rating for the company, indicating a positive outlook despite market pressures [5][6]. Core Insights - The company reported a revenue of 7.1 billion HKD for the first half of 2024, a year-on-year increase of 9.3%, and an adjusted net profit of 358 million HKD, up 67.3% year-on-year [5]. - The gross profit margin improved to 25.9%, reflecting a 1.7 percentage point increase year-on-year, indicating stable revenue and profitability [5]. - The company opened 402 new stores in the first half of 2024, bringing the total to 6,631 stores, with 58.2% located in lower-tier markets [5]. - The platform has accumulated 126 million registered users, with 11.5 million monthly active users, a 15.8% increase year-on-year [5]. - The company is focusing on enhancing service quality and user experience, which has led to a 40% reduction in complaints related to excessive sales practices [5]. Financial Summary - The company forecasts total revenue for 2024 to be 14.67 billion HKD, with a projected net profit of 570 million HKD, corresponding to a PE ratio of 22 [6][7]. - Revenue growth rates are expected to be 7.8% in 2024, 10.5% in 2025, and 11.1% in 2026 [7]. - The net profit is projected to increase significantly, with estimates of 1.008 billion HKD in 2025 and 1.434 billion HKD in 2026, reflecting a strong recovery from previous losses [7].