Dongpeng Holdings(003012) 天风证券·2024-10-28 09:42Investment Rating - The report maintains an "Accumulate" rating for the company, with a target price of 7.06 CNY based on a 20x PE for 2024 [4][6]. Core Views - The company's performance in Q3 was significantly under pressure, with a year-on-year revenue decline of 24.41% and a net profit drop of 59.94%. The overall revenue for the first three quarters of 2024 was 4.68 billion CNY, down 18.27% year-on-year, and the net profit was 309 million CNY, down 50.95% year-on-year. The report attributes this decline to high base effects from the previous year and ongoing weakness in the real estate sector, which has limited demand in the building ceramics industry [1][4]. - Despite the current challenges, the report expresses optimism about the company's long-term growth potential and market share improvement, especially if the real estate sector recovers [1][4]. Financial Performance Summary - In Q3 2024, the company's gross margin was 32.5%, a decrease of 0.44 percentage points year-on-year. The cumulative gross margin for the first three quarters was 31.2%, down 1.13 percentage points year-on-year. The report indicates that insufficient demand and rising raw material costs have pressured profitability [2]. - The company reported a period expense ratio of 20.17% for the first three quarters of 2024, an increase of 1.84 percentage points year-on-year. Although the company has been managing expenses effectively, the significant revenue decline has hindered the dilution of these costs [3]. - Cash flow from operations for the first three quarters of 2024 was 489 million CNY, a decrease of 962 million CNY year-on-year, with a cash collection ratio of 122.94%, down 1.02 percentage points year-on-year [3][10]. Financial Forecasts - The company is projected to achieve revenues of 6.58 billion CNY in 2024, a decrease of 15.36% year-on-year, followed by a recovery to 7.03 billion CNY in 2025 and 7.68 billion CNY in 2026 [5][11]. - The net profit attributable to the parent company is forecasted to be 414 million CNY in 2024, down 42.52% year-on-year, with expected growth of 16.72% in 2025 and 14.84% in 2026 [5][11]. Market Position and Valuation - The company has a well-established nationwide marketing network and distribution channels. If the real estate market improves, the company is expected to have a solid growth foundation and gradually increase its market share [4][8]. - The report compares the company's valuation with peers, indicating a current P/E ratio of 10.23 for 2023, which is lower than the average of comparable companies [8].