YONGHUI SUPERSTORES(601933) 海通国际·2024-09-05 04:03Investment Rating - The report maintains an "Outperform" rating for the company with a target price of RMB 4.00, representing a 17% downside from the current price [5] Core Views - The company is undergoing a transformation with the help of Pang Donglai and self-adjustment, aiming to improve user experience through product quality, store environment, and service [5] - Despite industry challenges, the company retains advantages in fresh produce supply chain, with potential for profit recovery if supply chain reforms and management optimization prove effective [5] - Online business has shown improvement, with reduced losses and increased coverage, contributing 20.8% of total revenue in 1H24 [3][5] Financial Performance - 1H24 revenue was RMB 37.78 billion, down 10.11% YoY, with net profit attributable to shareholders at RMB 275 million, down 26.34% YoY [1][2] - Gross profit margin in 1H24 was 21.58%, down 0.41 pct YoY, with fresh and processed food margin at 12.45%, down 0.77 pct YoY [2] - Operating cash flow in 1H24 was RMB 2.94 billion, up 13.63% YoY [1] Store Operations - The company opened 5 new stores and closed 62 stores in 1H24, ending with 943 stores and 865,300 square meters of reserved space [2] - Pang Donglai-assisted stores showed significant improvement, with daily sales increasing 13.9x and 8.2x in two stores after adjustments [5] Supply Chain and Product Optimization - The company optimized its product structure, introducing 20,276 new products and eliminating 22,480 products in 1H24, with a new product introduction rate of 22.5% [3] - Own-brand sales reached RMB 1.28 billion, accounting for 3.4% of total revenue [3] Industry Context - The supermarket industry faces pressure from channel diversion, deflationary environment, and declining consumer spending power [5] - Leading companies with fresh supply chain advantages may see a turning point if reforms and optimizations translate into same-store growth and profit recovery [5]