M&G(603899) 申万宏源·2024-06-30 23:32Investment Rating - Buy (Maintained) [3] Core Views - The company is a leader in the domestic stationery industry with a "one body, two wings" business layout, driving steady growth [3] - The stationery industry has a smooth price increase logic and a vast global market space [3] - The company's traditional core retail operations are deepening, with product and channel reforms driving growth [3] - The company's new retail exploration through JiMu ZaWuShe has been successful, forming a performance support [3] - The enterprise digital procurement market has huge potential, with KeLiPu's market share continuing to rise [3] Business Overview - The company's revenue in 2023 was 23.351 billion yuan, a year-on-year increase of 16.8%, with a CAGR of 24.2% from 2017 to 2023 [3] - Net profit attributable to the parent company in 2023 was 1.527 billion yuan, a year-on-year increase of 19.1%, with a CAGR of 15.8% from 2017 to 2023 [3] - The company's ROE has remained stable at over 20%, and is expected to rise steadily in the future [3] Industry Analysis - The domestic stationery market size in 2023 was 104.7 billion yuan, with significant room for growth compared to the Japanese market [3] - The global stationery market size is close to 200 billion USD, with Japanese companies like Pilot and Mitsubishi driving steady growth through globalization [3] - The domestic stationery industry is highly fragmented, with the company's market share at 7.5% in 2023, indicating room for further concentration [3] Traditional Core Business - The company's traditional core business has a strong retail operation capability, with product and channel reforms driving growth [3] - The company's product structure has been optimized, with the average product price continuously increasing since 2014 [3] - The company's channel strategy has shifted to focus on premium stores and increase online investment, with international expansion accelerating [3] JiMu ZaWuShe - JiMu ZaWuShe has successfully explored new retail, with 618 stores by the end of 2023 and a sales per square meter of 22,000 yuan, double that of 2018 [3] - JiMu ZaWuShe achieved profitability for the first time in 2023, and future franchise expansion is expected to accelerate, supporting revenue and profit growth [3] KeLiPu - The enterprise digital procurement market size in 2022 was 14.32 trillion yuan, with a CAGR of 14.0% from 2017 to 2022 [3] - KeLiPu's market share in office supplies and MRO is less than 5%, but the company's operational service capabilities are leading, with an ROE of over 25% [3] - KeLiPu is expected to maintain a high growth rate, with profitability improving as scale effects are realized [3] Financial Projections - The company's net profit attributable to the parent company is projected to be 1.784 billion yuan in 2024, 2.069 billion yuan in 2025, and 2.391 billion yuan in 2026, with year-on-year growth rates of 16.8%, 16.0%, and 15.6% respectively [3] - The company's PE ratio is expected to be 16X in 2024, 14X in 2025, and 12X in 2026, with a target PE of 22X and a target market value of 39.2 billion yuan, representing a 36% upside from the current level [3] Valuation and Target - The company's valuation has fallen to the bottom of its historical range, with a target PE of 22X and a target market value of 39.2 billion yuan, representing a 36% upside from the current level [3]