Tsingtao Brewery(SH:600600) Guotai Junan Securities·2024-10-31 00:49Investment Rating - The investment rating for Qingdao Beer is "Buy" with a target price of 78.80 CNY, up from the previous target of 73.70 CNY [4]. Core Views - The company's performance in Q3 2024 was below expectations, primarily due to a significant increase in sales expense ratio by 2.4 percentage points, which is higher than previous forecasts. This is considered a short-term impact [2][3]. - Revenue for Q3 2024 decreased by 5.3%, and net profit after deducting non-recurring items fell by 7.9%. The decline in sales volume is attributed to inventory control during peak season [2]. - The average selling price slightly decreased, with a sales volume drop of 5%. The main brand's sales volume was 1.225 million kiloliters, down 4.1% year-on-year [2]. - The company is expected to see a recovery in consumption and organizational innovation in the medium term, with a projected PE of 25X for 2024 [2]. Financial Summary - For 2024, the estimated revenue is 31.795 billion CNY, a decrease of 6.3% from 2023. The net profit is projected to be 4.398 billion CNY, reflecting a 3.0% increase [3]. - The earnings per share (EPS) for 2024 is revised to 3.22 CNY, down from the previous estimate of 3.35 CNY. EPS for 2025 and 2026 are projected at 3.44 CNY and 3.66 CNY, respectively [2][3]. - The net profit margin is expected to improve as the sales expense ratio returns to a reasonable range by 2025 [2].