Midea Group(SZ:000333) Xin Lang Cai Jing·2025-08-01 10:34Core Viewpoint - Midea Group is expected to maintain strong performance in Q2, leveraging domestic market advantages and overseas OBM business growth to counteract challenges such as increased competition and North American tariffs [1][2]. Domestic Sales Performance - The domestic market is experiencing robust growth driven by government subsidies and market share expansion, with Midea benefiting from its integrated supply chain and brand matrix [2]. - Online retail sales for air conditioners, refrigerators, and washing machines grew by 52%, 4%, and 32% respectively, with market share increases of 2.7, 2.2, and 0.8 percentage points [2]. - Offline retail sales for the same categories grew by 40%, 15%, and 10%, with market share increases of 1.6, 1.1, and 0.7 percentage points [2]. - The air conditioning segment is expected to see significant revenue boosts due to extreme summer temperatures, with the overall retail sales in the air conditioning industry growing by 31.29% in Q2 [2]. International Sales Performance - Midea's OBM business is expanding in emerging markets, effectively countering the impact of U.S. tariff changes, with strong growth in exports [3]. - Midea's self-owned brands have achieved market leadership in several countries, including first place in refrigerator market share in Malaysia, Saudi Arabia, and Chile [3]. - The company’s B-end business has shown rapid growth, with Q1 2025 revenue increasing by 25.3%, significantly outpacing the smart home segment [3]. Valuation Insights - Midea's current valuation reflects only its consumer business, with the B-end business being undervalued despite its rapid growth [4]. - The company’s robotics segment, which has lower profit margins, is not fully represented in the PE valuation, but future profitability improvements are expected to enhance its valuation [4]. Shareholder Returns - Midea has a strong capacity for shareholder returns through dividends and stock buybacks, with a buyback plan targeting over 70% of repurchased shares for cancellation [5][7]. - The company has already repurchased over 3.6 billion this year, with a dividend payout ratio nearing 70% [7]. Future Projections - Revenue projections for Midea are set at 442.4 billion, 479.8 billion, and 517.6 billion for 2025-2027, with growth rates of 8.7%, 8.5%, and 7.9% respectively [7]. - Net profit forecasts for the same period are 43.48 billion, 48.45 billion, and 53.78 billion, with growth rates of 12.8%, 11.4%, and 11.0% respectively [7].