Kouzijiao(SH:603589) Minsheng Securities·2024-10-31 00:32Investment Rating - The report maintains a "Recommended" rating for the company [2][4]. Core Views - The company reported a decline in revenue and net profit for the first three quarters of 2024, with total revenue of 4.362 billion yuan, a decrease of 1.89% year-on-year, and a net profit attributable to shareholders of 1.311 billion yuan, down 2.18% year-on-year [2]. - In Q3 2024, the company achieved revenue of 1.195 billion yuan, a significant drop of 22.04% year-on-year, while the net profit attributable to shareholders fell by 27.72% to 362 million yuan [2]. - The introduction of the new product "Jian 8" has received positive feedback, and the company is actively expanding its market presence outside its home province [2]. - The company's gross margin decreased in Q3 2024 due to increased promotional efforts and discounts, with a gross margin of 71.91%, down 5.90 percentage points year-on-year [2]. - The establishment of a marketing center has improved channel management, and the company is focusing on maintaining healthy channel development during the industry downturn [2]. Summary by Sections Financial Performance - For the first three quarters of 2024, the company reported total revenue of 4.362 billion yuan, with a net profit of 1.311 billion yuan, reflecting a year-on-year decline of 1.89% and 2.18% respectively [2]. - In Q3 2024, the company achieved a revenue of 1.195 billion yuan, with a net profit of 362 million yuan, marking a year-on-year decrease of 22.04% and 27.72% respectively [2]. Product and Market Development - The new product "Jian 8" was launched in April 2024 and has been well-received, contributing to a revenue of 11.39 million yuan from high-end liquor in Q3 2024, despite a year-on-year decline of 22.70% [2]. - The company is focusing on expanding its market presence outside its home province, with revenue from outside the province reaching 2.21 billion yuan in Q3 2024, a year-on-year decline of 25.59% [2]. Cost and Profitability - The gross margin for the first three quarters of 2024 was 74.76%, while it dropped to 71.91% in Q3 2024, impacted by increased promotional activities [2]. - The company's net profit margin for the first three quarters of 2024 was 30.05%, with a slight increase to 30.28% in Q3 2024, despite the overall decline in profitability [2]. Future Outlook - The company is expected to see a rebound in profitability as market conditions improve, with projected net profits of 1.650 billion yuan, 1.735 billion yuan, and 1.851 billion yuan for 2024, 2025, and 2026 respectively [3][5]. - The current stock price corresponds to a price-to-earnings ratio (PE) of 14 for 2024, indicating a stable valuation in the context of expected earnings growth [3][5].