Jasan Group(SH:603558) Changjiang Securities·2024-08-11 15:29Investment Rating - The report maintains a "Buy" rating for the company [5]. Core Views - In the short term, the negative impact of expenses on profits has been fully released, and with the decline in the baseline for seamless products, both business segments are expected to see significant revenue and performance elasticity due to large customer orders in H2 [4][5]. - The company achieved revenue, net profit attributable to the parent, and net profit excluding non-recurring gains and losses of 1.17 billion, 170 million, and 160 million yuan respectively in H1 2024, representing year-on-year growth of 5.5%, 33.8%, and 32.1% [4]. - The company is expected to maintain steady growth in cotton socks and see a recovery in seamless products, with projected net profits attributable to the parent company for 2024-2026 at 330 million, 390 million, and 440 million yuan, corresponding to year-on-year growth of 22%, 19%, and 13% [4][5]. Summary by Sections Financial Performance - In Q2 2024, the company reported revenue, net profit attributable to the parent, and net profit excluding non-recurring gains and losses of 620 million, 80 million, and 80 million yuan, with year-on-year changes of +1.5%, -1.8%, and -11.4% [4]. - The gross profit margin in Q2 2024 increased by 1.9 percentage points to 28.5%, while the net profit margin decreased by 0.5 percentage points due to increased selling and administrative expenses [4]. Future Outlook - The company is expected to benefit from strong customer relationships, robust R&D, and improved production efficiency, leading to enhanced competitiveness in cotton socks and optimistic capacity planning [4]. - The peak of capital expenditure has passed, and strong cash flow is anticipated to support high dividends [4][5].