Hongqi Chain(002697) 光大证券·2024-07-26 13:02Investment Rating - The report maintains a "Buy" rating for the company, citing its competitive strength in the convenience store business in Sichuan and gradual store upgrades and expansions [3][11] Core Views - The company's performance fell short of expectations, primarily due to declining investment returns from Xinwang Bank and Gansu Hongqi, leading to downward revisions of EPS forecasts for 2024/2025/2026 by 3%/5%/6% to 0.44/0.46/0.48 yuan [3] - Despite challenges, the company's convenience store business remains competitive, with steady growth in offline store upgrades and expansions [3] Financial Performance - In 1H2024, the company achieved revenue of 5.791 billion yuan, a year-on-year increase of 3.62%, with value-added business revenue growing by 12.57% to 1.514 billion yuan [2] - Net profit from main operations reached 207 million yuan, up 6.14% year-on-year, while investment income declined by 3.57% to 59 million yuan [2] - The company upgraded 202 stores and opened 16 new stores in 1H2024, bringing the total number of stores to 3,655 as of June 30, 2024 [2][16] - Online sales contributed nearly 500 million yuan, driving 5.35 million store visits [2] Operational Metrics - The company's comprehensive gross margin decreased by 0.37 percentage points in 1H2024, while the period expense ratio dropped by 0.27 percentage points [10] - In 2Q2024, the period expense ratio was 24.14%, down 0.56 percentage points year-on-year, with sales/management/financial expense ratios at 21.70%/1.66%/0.78%, respectively [7] Quarterly Breakdown - In 2Q2024, the company achieved revenue of 2.515 billion yuan, a year-on-year increase of 2.75%, with net profit attributable to shareholders of 103 million yuan, translating to a fully diluted EPS of 0.08 yuan, down 10.95% year-on-year [14] - For 1H2024, the company reported revenue of 5.186 billion yuan, up 3.67% year-on-year, and net profit attributable to shareholders of 267 million yuan, with a fully diluted EPS of 0.20 yuan, up 3.81% year-on-year [15] Historical Performance - From 2022 to 2026E, the company's revenue is projected to grow from 10.02 billion yuan to 11.191 billion yuan, with net profit increasing from 486 million yuan to 652 million yuan [6] - The company's ROE (diluted) is expected to decline from 13.7% in 2023 to 12.0% in 2026E, while the P/E ratio is forecasted to decrease from 11 in 2023 to 9 in 2026E [6][32]