YINGJIA DISTILLERY(SH:603198) Xin Lang Cai Jing·2025-08-27 18:59Core Viewpoint - The company reported a decline in revenue and net profit for the first half of 2025, indicating ongoing challenges in the liquor market, particularly in the mid-to-high-end segment [1][2]. Financial Performance - In H1 2025, the company achieved revenue of 3.16 billion yuan, down 16.9% year-on-year, and a net profit of 1.13 billion yuan, down 18.2% year-on-year [1]. - In Q2 2025, revenue was 1.11 billion yuan, a decrease of 24.1% year-on-year, with net profit at 300 million yuan, down 35.2% year-on-year [1]. - The gross margin in Q2 2025 decreased by 2.6 percentage points, reflecting pressure on the product mix in the mid-to-high-end series [2]. - The company's net profit margin in Q2 2025 fell by 4.6 percentage points due to industry adjustments [2]. Product and Market Analysis - Revenue from mid-to-high-end and regular liquor products in H1 2025 declined by 14.0% and 32.5%, respectively, while in Q2 2025, the declines were 23.6% and 32.9% [1]. - The company continues to focus on the mid-to-high-end market, with the Dongcang series as a core product, despite market pressures [1]. - Provincial revenue remains stronger than out-of-province, with H1 2025 provincial revenue accounting for 79.1% of total revenue [1]. Strategic Adjustments - The company signed a share transfer agreement to divest 100% of its stake in Yingjia Business Hotel, aiming to optimize asset management and focus on its core liquor business [2]. - This divestiture is part of the company's strategy to enhance competitiveness in the white liquor sector amid industry adjustments [2]. Future Outlook - The company expects revenues of 6.1 billion, 6.28 billion, and 6.53 billion yuan for 2025, 2026, and 2027, respectively, with net profits projected at 2.04 billion, 2.11 billion, and 2.22 billion yuan [3]. - The earnings per share (EPS) estimates for 2025, 2026, and 2027 are 2.6, 2.6, and 2.8 yuan, respectively, reflecting a downward revision from previous estimates [3]. - The target price for the company has been adjusted from 66 yuan to 64 yuan, maintaining an "outperform" rating [3].