GreatStar(SZ:002444) Huachuang Securities·2024-09-05 16:08Investment Rating - The report maintains a "Recommended" rating for the company with a target price of 33 yuan [2][3]. Core Views - The company achieved significant revenue growth driven by inventory replenishment, with a 27.8% year-on-year increase in revenue to 6.7 billion yuan and a 36.8% increase in net profit to 1.19 billion yuan in the first half of 2024 [2][3]. - The recovery in orders and revenue is attributed to the end of inventory destocking by downstream retailers in Europe and the US, along with the introduction of new products [3]. - The company is positioned as a global leader in hand tools, with expectations for a prosperous cycle in the tool industry due to recovery in housing turnover and retailer inventory replenishment [3]. Financial Summary - For the first half of 2024, the company reported revenue of 67.0 billion yuan, up 27.8% year-on-year, and a net profit of 11.9 billion yuan, up 36.8% year-on-year [2]. - In Q2 2024, revenue reached 33.9 billion yuan, reflecting a 26.2% year-on-year growth, with net profit at 7.8 billion yuan, a 36.9% increase [2][3]. - The gross margin improved to 32.7% in Q2 2024, up 2 percentage points year-on-year, driven by economies of scale and enhanced profitability from the Southeast Asia production base [3]. - The company expects net profits for 2024-2026 to be 2.15 billion, 2.71 billion, and 3.29 billion yuan, respectively, with corresponding P/E ratios of 16, 12, and 10 times [3][9].