CBEST(SH:600729) GF SECURITIES·2024-07-11 04:31Investment Rating - The report maintains a "Buy" rating for the company, with a target price of 28.00 CNY per share based on a 9x PE for the expected net profit in 2024 [2][7]. Core Insights - The company has launched its first "Fresh + Discount" store model, which has significantly boosted sales, achieving over 5 times year-on-year growth on opening day. The second store is set to open by the end of June [2]. - Despite short-term pressure on earnings, the company is actively innovating its business model, which is expected to enhance operational capabilities. The performance of the consumer finance business is anticipated to reflect actual growth in financial reports after the normalization of the base in the second half of 2024 [2][5]. Financial Summary - For the first half of 2024, the company reported revenues of 8.98 billion CNY, a decline of 11.6% year-on-year, and a net profit attributable to shareholders of 710 million CNY, down 21.1% year-on-year. The decline in net profit is primarily attributed to reduced profits from consumer finance and non-recurring losses from the decline in the stock price of a subsidiary [5][6]. - The company’s net profit for the second quarter of 2024 was 280 million CNY, a decrease of 35.9% year-on-year, with revenues of 4.13 billion CNY, down 18.2% year-on-year [5][6]. - The projected net profits for the company from 2024 to 2026 are 1.39 billion CNY, 1.50 billion CNY, and 1.62 billion CNY, with year-on-year growth rates of 6.1%, 7.8%, and 7.9% respectively [2][6].