Investment Rating - The report maintains a "Recommend" rating for Tuhu, with a target price of 17.06 HKD [2] Core Views - Tuhu's revenue is primarily driven by individual consumers, with 80% of its income coming from this segment [1] - The company's gross margin improvement is attributed to scale effects, higher-margin maintenance services, and increased sales of proprietary products [1] - Tuhu's single-store model shows that franchisees typically break even in 2-3 years, with steady-state operations achieved after 3 years [1] - The report forecasts Tuhu's revenue for 2024-2026 to be 14.7/16.1/17.7 billion RMB, with adjusted net profits of 750/1190/1600 million RMB [1] Revenue Breakdown - In 2023, 50% of Tuhu's revenue came from tires and chassis components, while 44% came from maintenance services [1] - The gross profit contribution from tires and chassis components was 37%, while maintenance services contributed 40% [1] - Tuhu's revenue from individual consumers reached 11.265 billion RMB in 2023, accounting for 82.8% of total revenue [7] Gross Margin Analysis - Tuhu's gross margin increased from 7.4% in 2019 to 24.7% in 2023, driven by direct procurement and scale effects [11] - The maintenance business, with a gross margin of 32.4% in 2023, contributed 60% of the total gross profit [9] - Tuhu's proprietary and exclusive brands accounted for 68.3% of revenue in 2023, up from 22.2% in 2019 [16] Single-Store Model - Tuhu's stores typically reach steady-state operations after 3 years, with average store revenue increasing from 324,000 RMB in the first year to 775,000 RMB after 3 years [20] - The gross margin of stores increases from 21.6% in the first year to 25.7% after 3 years [20] - Franchisees typically break even in 2-3 years, with a store lifecycle of over 8 years [23] Competitive Landscape - Tuhu operates over 6,000 stores as of May 2024, significantly more than competitors like Tmall Auto Care and JD Auto Care [6] - Tuhu's supply chain includes 34 regional distribution centers and 511 front-end distribution centers, ensuring efficient logistics [56] - The company's user base reached 115 million registered users by the end of 2023, with a 60% repurchase rate [6] Industry Comparison - The US auto aftermarket leaders, AutoZone and O'Reilly, achieved 10-year revenue CAGRs of 6.7% and 9.0%, respectively, from 2013 to 2023 [81] - AutoZone and O'Reilly's store counts grew at CAGRs of 3.2% and 4.0%, respectively, during the same period [80] - Tuhu's growth trajectory is compared to these US leaders, with a focus on the potential for similar scale and profitability in China [78] Market Potential - China's average vehicle age is 6.2 years in 2022, expected to reach 8.0 years by 2027, indicating significant growth potential in the aftermarket [74] - The report highlights that 55% of vehicles in China are under 6 years old, and 66% have annual mileage below 10,000 km, suggesting untapped demand for aftermarket services [70]
途虎-W：深度系列（二）：途虎养车核心十一问