KinLong(002791) 华泰证券·2024-09-01 06:03Investment Rating - The investment rating for the company is maintained as "Buy" with a target price of RMB 29.51 [1] Core Insights - The company reported a revenue of RMB 3.21 billion for H1 2024, a year-on-year decrease of 4.35%, and a net profit attributable to the parent company of RMB 4.89 million, down 62.02% year-on-year [1] - The company is focusing on expanding new scenarios and products, which has led to a stable gross margin of 31.27% in H1 2024, with specific product lines showing varied performance [2] - The company is actively pursuing channel expansion and overseas market development, with over 1,000 sales contact points established [4] Revenue and Profitability - H1 2024 revenue breakdown includes: RMB 1.39 billion from door and window hardware (down 16.0%), RMB 0.59 billion from home products (up 13.7%), and RMB 0.52 billion from other construction hardware (up 16.6%) [2] - The gross margin for H1 2024 was 31.27%, slightly up by 0.08 percentage points year-on-year [2] - The company’s net profit margin for H1 2024 was 0.15%, a decrease of 0.23 percentage points year-on-year [3] Financial Metrics - The company’s operating cash flow improved significantly, with a net cash flow from operating activities of -RMB 190 million, an increase of RMB 238 million year-on-year [3] - The company’s debt ratios include a total debt ratio of 43.5% and a interest-bearing debt ratio of 5.2%, both showing a decrease compared to the previous year [3] - The forecasted sales revenue for 2024-2026 is adjusted to RMB 7.30 billion, RMB 7.98 billion, and RMB 8.83 billion respectively [5] Market Position and Strategy - The company is leveraging opportunities in channel penetration and the long-tail effect of new product categories, with a focus on emerging markets related to the "Belt and Road" initiative [4] - The sales team has expanded to over 6,200 personnel, enhancing the company's market reach [4] - The company has established 16 overseas warehouses to replicate its domestic sales model, aiming for quick response to customer supply needs [4]