Investment Rating - The report maintains a "Buy" rating for the company, with a target price of HKD 0.73, indicating a potential upside of 15.9% from the current price of HKD 0.63 [2][4]. Core Insights - The company reported a significant improvement in profitability despite a 9% decline in revenue for 1H24, achieving a 10% year-on-year increase in net profit attributable to shareholders. This performance is attributed to cost reduction and efficiency improvements that countered the negative impact of operating leverage [2][10]. - The second quarter of 2024 saw a remarkable 89% year-on-year increase in net profit, despite a 10.5% drop in revenue, primarily due to a substantial rise in gross margin and a significant reduction in operating expenses [2][10]. - The company is expected to continue focusing on maintaining healthy inventory levels and improving retail discounts in the second half of 2024, with ongoing efforts to enhance operational efficiency and reduce costs [2][10]. Financial Performance Summary - For 1H24, the company reported revenue of RMB 9,983 million, a decrease of 8.9% year-on-year, while gross profit was RMB 3,416 million, reflecting a gross margin of 34.2% [10][11]. - The operating profit for 1H24 was RMB 483 million, with an operating margin of 4.8%, indicating a slight improvement from the previous year [10][11]. - The forecast for 2024 estimates total revenue of RMB 18,514 million, with a projected net profit of RMB 516 million, representing a 5.1% increase year-on-year [12]
宝胜国际：1H24业绩超预期；降本增效抵御经营负杠杆，保障稳健的利润率