Shanghai Jahwa(600315) 国元证券·2024-10-31 00:34Investment Rating - The investment rating for the company is "Buy" and is maintained [2][5]. Core Insights - The company's Q3 performance was under pressure due to multiple internal and external factors, with a revenue decline of 12.07% year-on-year for the first three quarters of 2024, totaling 4.477 billion yuan. The net profit attributable to the parent company was 163 million yuan, with a net profit excluding non-recurring items of 120 million yuan. In Q3 alone, revenue was 1.156 billion yuan, down 20.93% year-on-year, and the net profit attributable to the parent company was a loss of 75 million yuan [3]. - The company is undergoing strategic adjustments, with a focus on optimizing products, brands, and organizational structure. New product launches and adjustments in online channel operations have shown initial positive results during major promotional events [4]. - The company has adjusted its revenue forecasts for 2024-2026, expecting revenues of 6.052 billion yuan, 6.471 billion yuan, and 7.041 billion yuan, respectively, with net profits of 318 million yuan, 435 million yuan, and 492 million yuan, respectively. The earnings per share (EPS) are projected to be 0.47 yuan, 0.64 yuan, and 0.73 yuan, corresponding to price-to-earnings ratios (PE) of 36x, 26x, and 23x [5]. Financial Performance - For the first three quarters of 2024, the gross margin was 59.41%, a decrease of 0.11 percentage points year-on-year, while the net profit margin was 3.63%, down 4.11 percentage points year-on-year [3]. - The company reported a revenue of 6.597 billion yuan in 2023, a decline of 7.16% compared to 2022, with a net profit of 500 million yuan, reflecting a year-on-year increase of 5.93% [6]. - The projected financials for 2024 include a revenue of 6.052 billion yuan, a net profit of 318 million yuan, and an EPS of 0.47 yuan, indicating a significant decline in profitability compared to previous years [6][9]. Market Position and Strategy - The company aims to become a leading daily cosmetics company in China and expand its presence overseas by enhancing its brand and product quality [4]. - The company has seen revenue from personal care products reach 532 million yuan, while beauty products generated 95.07 million yuan, and innovative products contributed 1.51 billion yuan in revenue [4]. Valuation Metrics - The company's market capitalization is approximately 11.179 billion yuan, with a circulating market value of 11.179 billion yuan [7]. - The stock price has shown a significant decline of 39% over the past year, indicating challenges in market performance [8]. Conclusion - The company is currently facing challenges due to strategic adjustments and market conditions, but it has potential for recovery with ongoing product and brand optimization efforts. The maintained "Buy" rating reflects confidence in the company's long-term growth prospects despite short-term pressures [2][5].