CBEST(SH:600729) Guoxin Securities·2024-07-11 11:30Investment Rating - The investment rating for the company is "Outperform the Market" [9][30]. Core Views - The company's revenue for the first half of 2024 was CNY 8.98 billion, a year-on-year decrease of 11.56%, while the net profit attributable to shareholders was CNY 712 million, down 21.06% year-on-year. The net profit excluding non-recurring items was CNY 704 million, a decline of 13.06% year-on-year [1][3]. - The decline in the company's main business is attributed to the overall weakness in offline retail consumption and short-term non-operating factors, as well as fluctuations in the performance of the associate company, Ma Shang Consumer Finance. Excluding non-recurring gains and the impact of Ma Shang's investment income, the retail main business is expected to achieve a profit of CNY 374 million, a decrease of 4.52% year-on-year [2][30]. - The company is actively exploring innovative developments in new discount formats, with expectations for increased local market penetration and transformation in the second half of the year. The completion of the reverse merger with the major shareholder, Chongqing Commerce, and the smooth transition of management is expected to enhance business integration and operational efficiency in the long term [2][30]. Summary by Sections Financial Performance - In Q2 2024, the company achieved revenue of CNY 4.13 billion, a year-on-year decline of 18.19%, and a net profit of CNY 277 million, down 35.92% year-on-year. The net profit excluding non-recurring items was CNY 258 million, a decrease of 25.64% year-on-year [3]. - The company has adjusted its net profit forecasts for 2024-2026 to CNY 1.268 billion, CNY 1.323 billion, and CNY 1.398 billion, respectively, down from previous estimates of CNY 1.422 billion, CNY 1.501 billion, and CNY 1.572 billion [2][30]. Business Strategy - The company launched its first "Fresh + Discount" model store in May 2024, achieving sales of over CNY 500,000 on the first day and a total of CNY 1.986 million in six days, representing a year-on-year increase of 538% [5]. - The new management team, which has recently transitioned, is expected to bring renewed operational vitality to the company [29].