Tsingtao Brewery(SH:600600)2024-10-31 08:00Investment Rating - The report maintains a "Hold" rating for Qingdao Beer (168.HK/600600.CH) [4][11] Core Views - The report indicates that Qingdao Beer is facing short-term challenges, including weak overall sales, pressure on product structure, and increased sales expenses impacting profit margins [4][9] - The forecast for revenue and profit has been adjusted downward for 2024-2026 due to the performance in Q3 2024 [4][9] Financial Performance Summary - Q3 2024 net profit decreased by 9.0% year-on-year, while revenue fell by 5.3%, with profit decline outpacing revenue decline due to a significant rebound in sales expense ratio [4][6] - The overall sales volume in Q3 2024 dropped by 5.1% year-on-year, with the main brand's sales volume down by 4.1% [4][8] - The average selling price saw a slight decline of 0.2% year-on-year, indicating pressure on product structure [4][8] - Core operating profit margin contracted by 70 basis points year-on-year, with core operating profit down by 9% [4][8] Revenue and Profit Forecasts - Revenue forecasts for 2024E, 2025E, and 2026E are adjusted to RMB 31.839 billion, RMB 32.971 billion, and RMB 34.082 billion respectively, reflecting a decrease of 8.4% from previous estimates [9] - The forecast for net profit attributable to shareholders for 2024E, 2025E, and 2026E is revised to RMB 4.352 billion, RMB 4.822 billion, and RMB 5.269 billion, representing a decrease of 13.1% from prior estimates [9] Target Prices - The target price for Qingdao Beer A-shares is adjusted to RMB 70.6, with a potential upside of 3.1% from the current price of RMB 68.5 [4][11] - The target price for Qingdao Beer H-shares is set at HKD 58.4, indicating a potential upside of 10.6% from the current price of HKD 52.8 [4][11]