CHANGHONG(600839) 太平洋·2024-10-29 02:17Investment Rating - The report maintains a "Buy" rating for Sichuan Changhong, with a target price based on the last closing price of 11.25 [1][5]. Core Views - Sichuan Changhong achieved a revenue of 772.98 billion yuan in the first three quarters of 2024, representing a year-on-year growth of 10.33%. However, the net profit attributable to shareholders decreased by 28.03% to 3.45 billion yuan, while the net profit excluding non-recurring items increased by 42.72% to 1.82 billion yuan [2][3]. - In Q3 2024, the company reported a revenue of 258.79 billion yuan, marking a growth of 10.52%. However, the net profit attributable to shareholders fell sharply by 76.82% to 0.64 billion yuan, primarily due to a significant decrease in the fair value increase of investments in Huafeng Technology and a reduction in government subsidies recognized in the current period [3][4]. - The company is deeply involved in Huawei's computing power industry chain through its subsidiaries, which have secured various distribution rights and partnerships, enhancing its market position [4][5]. Summary by Sections Financial Performance - For Q3 2024, the gross margin was 9.36%, down by 2.69 percentage points, indicating a decline in profitability. The net margin was 1.25%, a decrease of 1.1 percentage points, benefiting from a reduction in expense ratios [3]. - The company’s operating expenses as a percentage of revenue were well-controlled, with sales, management, R&D, and financial expense ratios at 3.68%, 1.84%, 2.18%, and -0.08% respectively [3]. Future Outlook - The company is expected to benefit from domestic policies promoting the replacement of old appliances and a recovery in overseas demand, which may lead to a restoration of revenue growth [5]. - Projections for net profit attributable to shareholders for 2024-2026 are 8.75 billion yuan, 11.54 billion yuan, and 13.41 billion yuan, with corresponding EPS of 0.19 yuan, 0.25 yuan, and 0.29 yuan, indicating a positive growth trajectory [5][6].