季报点评：质量持续修复，盈利拐点仍需等待

Investment Rating - The report maintains a "Buy" rating for the company with a target price of $3.44 [6][7]. Core Insights - The company reported a revenue of 5.54 billion RMB in Q3 2024, a year-on-year decrease of 31.1% and a quarter-on-quarter decrease of 7.2%. The net profit attributable to the parent company was -0.875 billion RMB, indicating a shift from profit to loss year-on-year and an increase in loss by 10.4% quarter-on-quarter. The widening loss is attributed to an increase in the proportion of loans under a heavy capital model, leading to higher expected credit impairment losses [1][4]. - Loan quality continues to improve, with the C-M3 ratio for small microloans remaining stable at 0.9% and the non-performing loan (NPL) ratio decreasing to 1.2% in Q3 2024 from 1.4% in Q2 2024. The company expects to achieve profitability in the future as the phase of rapid growth in heavy capital business scales down [1][3]. Summary by Sections Financial Performance - In Q3 2024, the company issued new loans totaling 50.5 billion RMB, a quarter-on-quarter increase of 12%, primarily driven by consumer loans. The total loan balance at the end of Q3 2024 was 213.1 billion RMB, reflecting a year-on-year decrease of 42% and a quarter-on-quarter decrease of 9% [2][3]. - The take rate increased to 9.8% in Q3 2024 from 9.3% in Q2 2024, as the company transitioned to a 100% guarantee model, which involves taking on more risk [2]. Loan Quality - The C-M3 ratio for small microloans remained at 0.9%, indicating stable loan quality. The NPL ratio for consumer loans improved to 1.2% from 1.4% in the previous quarter. Despite the improvement in loan quality, the credit impairment loss as a percentage of loans carrying credit risk increased to 9.6% from 7.7% in Q2 2024 [3][4]. Profitability Forecast and Valuation - The profit forecasts for 2024, 2025, and 2026 have been adjusted to -3.343 billion RMB, 1.437 billion RMB, and 2.750 billion RMB, respectively. The target price has been revised down to $3.44 from $3.60. The current stock price trades at 0.22x the estimated price-to-book ratio for 2025 [4][9].