TongQingLou Catering (SH:605108) Huafu Securities·2024-09-05 12:30Investment Rating - The report maintains a "Buy" rating for the company, expecting a relative price increase of over 20% compared to the market benchmark index within the next six months [14]. Core Views - The company reported a revenue of 1.271 billion yuan in the first half of 2024, representing a year-on-year increase of 17.50%, while the net profit attributable to shareholders decreased by 44.40% to 81 million yuan [1][4]. - The decline in profit is attributed to the high base from the previous year due to compensation from store relocation and the significant costs associated with opening new stores during their ramp-up phase [4]. - The company is in a phase of expansion, having opened five new stores in the first half of 2024, with plans for an additional 4-6 stores in the second half of the year [2][4]. Financial Performance Summary - In the first half of 2024, the company's restaurant and accommodation services generated revenue of 1.129 billion yuan with a gross margin of 23.77%, while food sales contributed 142 million yuan with a gross margin of 34.19% [2]. - The gross margin for the first half of 2024 was 21.56%, a decrease of 3.17 percentage points compared to the same period last year [3]. - The company’s operating expenses increased due to the expansion, with sales expense ratio rising to 5.96% and management expense ratio at 5.13% [3]. Profit Forecast Adjustments - Based on the second quarter performance, the profit forecasts for 2024-2026 have been adjusted to 282 million yuan, 362 million yuan, and 452 million yuan respectively, with corresponding price-to-earnings ratios of 15, 12, and 10 times [4].