ORIENTAL YUHONG(SZ:002271) Tebon Securities·2024-08-29 13:45Investment Rating - The report maintains a "Buy" rating for Dongfang Yuhong (002271.SZ) [2][7] Core Views - The company is focusing on channel transformation and strengthening its retail foundation despite challenges in the real estate sector [2][6] - The company reported a revenue of approximately 15.218 billion yuan for the first half of 2024, a year-on-year decrease of 9.69%, and a net profit of about 943 million yuan, down 29.31% year-on-year [4][5] - The retail business showed resilience with a revenue of approximately 5.438 billion yuan, up 7.66% year-on-year, accounting for 35.74% of total revenue [4][5] Summary by Sections Market Performance - The company's stock has underperformed compared to the CSI 300 index, with a significant decline of 71% as of August 2023 [3] Financial Performance - In H1 2024, the company achieved a gross margin of 29.22%, a slight increase of 0.32 percentage points year-on-year, attributed to an improved revenue structure [4][5] - The company's operating cash flow showed a significant improvement, with a net cash outflow of 1.328 billion yuan, a 66.33% reduction compared to the previous year [5] Business Strategy - The company is accelerating its global expansion, with new production bases established in Houston, Saudi Arabia, and Malaysia, aiming to enhance its competitive edge in international markets [5][6] - The company is committed to channel reform and diversification to mitigate risks associated with reliance on a single product category [6][7] Financial Projections - The report projects net profits for 2024, 2025, and 2026 to be 2.364 billion yuan, 2.658 billion yuan, and 3.102 billion yuan respectively, with corresponding EPS of 0.97, 1.09, and 1.27 yuan [7][10]