地素时尚：渠道仍在调整阶段，利润承压，期待修复

Investment Rating - The report maintains a "Buy" rating for the company [7] Core Views - The company has experienced a decline in revenue and net profit, with Q1-Q3 2024 showing a 13% decrease in revenue to 1.61 billion and a 33% decrease in net profit to 280 million [1] - The company is facing pressure on profits due to ongoing adjustments in its channels and a decrease in consumer traffic [5] - The report highlights the need to monitor the company's channel plans and anticipates a return to stable growth in revenue and profit in the medium to long term [5] Financial Performance Summary - For Q3 2024, the company reported revenue of 480 million, down 19% year-on-year, and a net profit of 60 million, down 47% [2] - The gross margin for Q3 2024 improved slightly to 73.6%, while the net margin decreased to 11.7% [2] - The company's online sales for Q1-Q3 2024 were 264 million, a decrease of 5%, while offline sales from direct and distribution channels were 633 million and 712 million, down 20% and 8% respectively [4] - The company has made a cautious provision for asset impairment amounting to 55 million, representing 3.4% of revenue, and inventory turnover days increased by 39 days to 287.4 days [4] Brand and Channel Performance - All brands under the company have seen a decline in sales, with Q1-Q3 2024 revenues for DA, DM, DZ, and RA brands down 15%, 14%, 10%, and 6% respectively [3] - The number of stores for key brands is still in a phase of adjustment, with a reduction in the number of stores impacting recent revenue performance [3] - The report indicates that the company’s direct sales channels are under more pressure compared to its distribution channels, which have seen a narrower decline [4] Earnings Forecast and Investment Suggestion - The company is projected to have net profits of 351 million, 395 million, and 436 million for 2024, 2025, and 2026 respectively, with a current price corresponding to a PE of 16 times for 2024 [5][6] - The report emphasizes the company's strong design capabilities and supply chain management, suggesting a solid foundation for future growth despite current challenges [5]