Fuling Zhacai(SZ:002507) KAIYUAN SECURITIES·2024-10-31 06:57Investment Rating - Investment rating is maintained as "Buy" [1][2] Core Views - The company reported Q3 2024 revenue and net profit in line with expectations, with revenue of 6.6 billion yuan and net profit of 2.2 billion yuan, representing year-on-year growth of 6.8% and 17.9% respectively [2][3] - The company has successfully reversed a five-quarter revenue decline, attributed to the effectiveness of its reform initiatives and new product strategies [3][4] - Cost advantages have been realized, with raw material prices decreasing significantly, leading to an improvement in gross margin by 10.5 percentage points to 56.2% in Q3 2024 [4] Financial Performance Summary - For the first three quarters of 2024, the company achieved revenue of 19.6 billion yuan and net profit of 6.7 billion yuan, with year-on-year increases of 0.6% and 1.7% respectively [2] - The forecast for net profit from 2024 to 2026 is 8.8 billion yuan, 9.6 billion yuan, and 10.6 billion yuan, reflecting year-on-year growth rates of 6.2%, 9.7%, and 10.6% respectively [2][6] - The company's earnings per share (EPS) are projected to be 0.76 yuan, 0.83 yuan, and 0.92 yuan for 2024, 2025, and 2026 respectively [2][6] Strategic Outlook - The company is implementing the "Big Wujang" strategy, focusing on expanding product lines beyond pickled vegetables to include radishes and pickled sauces [5] - Continued reform benefits are expected to enhance internal motivation and operational performance, particularly in Q4 2024 against a low base from the previous year [5]