LZLJ(SZ:000568) Southwest Securities·2024-09-02 10:10Investment Rating - The report maintains a "Buy" rating for Luzhou Laojiao (000568) with a target price of 155.40 CNY over the next six months [1][11]. Core Insights - In the first half of 2024, the company achieved a revenue of 16.9 billion CNY, representing a year-on-year growth of 15.8%, and a net profit of 8.03 billion CNY, up 13.2% year-on-year. The second quarter alone saw revenues of 7.72 billion CNY, a 10.5% increase year-on-year, with a net profit of 3.45 billion CNY, growing 2.2% year-on-year [2][3]. - The company demonstrated strong growth resilience despite a relatively weak external consumption environment, driven by its strong brand power and proactive market expansion strategies [2][3]. - The high-end product lines, particularly Guojiao and Tequ, are expected to continue driving growth, with the high-end Guojiao series projected to grow around 15% [3][11]. Revenue and Profitability - The revenue from mid-to-high-end liquor reached 15.21 billion CNY in the first half of 2024, up 17.1% year-on-year, with sales volume increasing by 25.7% but average price per ton decreasing by 6.8% [2][3]. - The gross margin slightly improved by 0.2 percentage points to 88.8% in Q2 2024, attributed to the increased proportion of mid-to-high-end liquor sales [2][3]. - The net profit margin faced temporary pressure, declining by 3.7 percentage points to 44.9% in Q2 2024 due to increased tax rates and other expenses [2][3]. Future Outlook - The company plans to deepen its marketing efforts in the second half of 2024, focusing on expanding its market presence in key regions such as East China and Northwest China [3][11]. - The expected earnings per share (EPS) for 2024-2026 are projected to be 10.36 CNY, 11.83 CNY, and 13.34 CNY, respectively, with corresponding price-to-earnings (PE) ratios of 12, 10, and 9 [3][11]. - The company is anticipated to maintain a stable growth trajectory, supported by its brand strength and market expansion initiatives [3][11].