By-health(SZ:300146) HTSC·2024-08-06 01:03Investment Rating - The report maintains a "Buy" rating for the company with a target price of 15.37 RMB [3][4][8] Core Insights - The company's revenue and net profit have declined significantly due to a high base effect from the previous year and increased competition across various channels [3][4] - The company is focusing on enhancing its main brand and Life-Space through differentiated product offerings and strengthening offline distribution channels [3][4] - The report projects EPS for 2024-2026 to be 0.70, 0.83, and 0.97 RMB respectively, with a target PE of 22x for 2024 [3][4] Financial Performance Summary - For H1 2024, the company reported revenue of 4.61 billion RMB, a decrease of 17.6% year-on-year, and a net profit of 889 million RMB, down 42.3% [3][4] - The gross margin for H1 2024 was 68.6%, a decline of 1.8 percentage points compared to the previous year, primarily due to rising raw material costs [5][10] - The company’s main brand generated revenue of 2.64 billion RMB in H1 2024, down 19.8% year-on-year, while the Life-Space brand saw a domestic revenue of 210 million RMB, down 24.8% [4][5] Market Position and Strategy - The company is implementing a multi-brand strategy to enhance brand strength and is focusing on optimizing operational strategies to improve quality [4][5] - The report highlights the company's efforts to solidify its competitive advantage in offline channels through category expansion and service enhancement [4][5] Valuation Metrics - The report provides a comparison of the company's valuation metrics with peers, indicating a PE of 19 for 2024, which is lower than the industry average [9][10] - The projected revenue for 2024 is 8.447 billion RMB, reflecting a decrease of 10.21% from the previous year, with a net profit forecast of 1.188 billion RMB [6][10]