Vatti(SZ:002035) Guolian Securities·2024-09-01 10:03Investment Rating - The investment rating for the company is maintained as "Buy" [4][2]. Core Views - The company is currently in a recovery phase, awaiting the effects of policy implementation. Despite significant pressure on kitchen appliance demand since Q2, the anticipated rollout of the old-for-new policy is expected to boost demand. The company is projected to achieve revenue growth of +6%/+10%/+10% for 2024-2026, reaching 6.6 billion, 7.3 billion, and 8.0 billion respectively. Net profit attributable to shareholders is expected to grow by +33%/+14%/+14%, reaching 600 million, 680 million, and 770 million respectively, with corresponding P/E ratios of 8.9, 7.8, and 6.9. The dividend yield is projected at 6.3%, based on a 56% payout ratio for 2023 [2][6][4]. Financial Performance - In H1 2024, the company achieved revenue of 3.101 billion, a year-on-year increase of +7.68%, and a net profit of 300 million, up +14.77%. In Q2 2024, revenue was 1.720 billion, with a year-on-year growth of +2.07%, and net profit was 176 million, up +3.95% [6][10]. - Domestic and overseas revenue growth was notable, with domestic revenue increasing by +4% and overseas revenue by +35%. Offline revenue grew by +21%, with a 52% revenue share, while the emerging channels saw a +41% increase, accounting for 19% of total revenue [6][10]. - The company’s gross margin in Q2 decreased by 2.8 percentage points, primarily due to faster growth in lower-margin overseas and emerging channel revenues, alongside intensified price competition in the industry. However, the net profit margin improved slightly by +0.2 percentage points due to reduced sales expense ratios and lower credit impairment losses [6][10]. Future Outlook - The company is expected to continue its operational improvement, with revenue growth anticipated to remain stable. The rollout of the old-for-new policy is expected to positively impact the demand for large kitchen appliances, supporting the company's revenue growth outlook [6][10]. - The financial forecasts indicate a steady increase in revenue and net profit over the next few years, with significant growth rates projected for both metrics [7][14].