CHINA PET FOODS(002891) 东兴证券·2024-10-28 10:11Investment Rating - Strong Buy/Maintain [3] Core Views - The company achieved revenue of 3.189 billion yuan in the first three quarters of 2024, a year-on-year increase of 17.56%, and net profit attributable to the parent company of 282 million yuan, a year-on-year increase of 59.54% [3] - In Q3 2024, the company achieved revenue of 1.232 billion yuan, a year-on-year increase of 23.55%, and net profit attributable to the parent company of 140 million yuan, a year-on-year increase of 73.18% [3] - The company has 22 modern pet food production bases globally, exporting products to 82 countries and regions across five continents, with self-owned brands exported to 68 countries and regions [3] - Domestic business has achieved profitability, with future profitability expected to improve through production efficiency enhancements, product structure optimization, and direct sales channel improvements [3] Financial Performance - Gross margin for the first three quarters of 2024 was 27.55%, an increase of 1.70 percentage points year-on-year [4] - Sales, management, R&D, and financial expense ratios for the first three quarters were 10.45%, 4.17%, 1.60%, and 0.53%, respectively, with a combined increase of 1.63 percentage points year-on-year [4] - The company's net profit margin reached 9.48%, an increase of 1.18 percentage points year-on-year, driven by investment income of 33.3 million yuan from Zhongchong Huiying Industrial Fund [4] Domestic Brand Development - The company's three major self-owned brands, ZEAL, Toptrees, and Wanpy, have shown rapid growth in the domestic market [4] - ZEAL partnered with the popular IP "Naiwa Family" and launched products on Li Jiaqi's live streaming platform [4] - Toptrees collaborated with the hit drama "Empresses in the Palace," leading to strong sales growth both online and offline [4] - Wanpy launched new products such as "Wanpy Little Golden Shield" cat food and freeze-dried goat milk sticks during the Asia Pet Expo [4] Future Projections - The company is expected to achieve net profit attributable to the parent company of 302 million yuan, 399 million yuan, and 492 million yuan in 2024, 2025, and 2026, respectively [5] - EPS is projected to be 1.03 yuan, 1.36 yuan, and 1.67 yuan for 2024, 2025, and 2026, respectively [5] - PE ratios are expected to be 29x, 22x, and 18x for 2024, 2025, and 2026, respectively [5] Company Overview - The company operates globally in the pet food industry with multiple self-owned brands, including Wanpy, Natural Farm, and Dr. Hao [6] - Products are sold in over 30 countries and regions, including Japan, the US, Canada, Germany, and the UK [6] Financial Data - The company's 52-week stock price range is 18.0 to 29.84 yuan, with a total market capitalization of 8.638 billion yuan [6] - The company's total shares outstanding are 294.11 million, with a 52-week average turnover rate of 2.84% [6] Historical Performance - Revenue growth rates for 2022, 2023, and 2024E are 12.72%, 15.37%, and 17.56%, respectively [8] - Net profit growth rates for 2022, 2023, and 2024E are -8.38%, 120.12%, and 29.35%, respectively [8] - ROE for 2022, 2023, and 2024E are 5.13%, 10.44%, and 11.95%, respectively [8]