YILI(600887) 华创证券·2024-10-31 01:23Investment Rating - The report maintains a "Strong Buy" rating for the company with a target price of 36 CNY, compared to the current price of 26.44 CNY [4]. Core Views - The company has shown significant improvement in profitability, exceeding expectations due to effective adjustments in operations and cost management [1][2]. - The report anticipates a recovery in demand and stabilization of raw milk prices, which could lead to a positive trend in the company's operations [2]. Financial Performance Summary - For the first three quarters of 2024, the company achieved a revenue of 887.3 billion CNY, a year-on-year decrease of 8.61%, while the net profit attributable to shareholders was 108.7 billion CNY, an increase of 15.9% [1]. - In Q3 2024, the company reported a revenue of 290.4 billion CNY, down 6.66% year-on-year, but the net profit increased by 8.5% to 33.37 billion CNY [1]. - The gross profit margin for Q3 2024 was 34.85%, an increase of 2.48 percentage points year-on-year, indicating improved cost efficiency [1]. Product Performance Summary - In Q3 2024, the liquid milk segment saw a revenue decline of 10.3%, while the milk powder segment experienced a growth of 6.6% [1]. - The company has effectively managed inventory levels, leading to a reduction in promotional expenses and an optimized product mix [1]. Future Outlook - The report suggests that the company is likely to benefit from a recovery in demand as inventory levels normalize and the market prepares for the upcoming peak season [2]. - The forecast for EPS has been adjusted upwards to 1.88 CNY for 2024, reflecting confidence in the company's recovery trajectory [2][3].