Fuling Zhacai(SZ:002507) Haitong Securities·2024-10-31 09:17Investment Rating - The investment rating for the company is "Outperform the Market" and is maintained [2] Core Views - The company reported a total revenue of 1.962 billion yuan for the first three quarters of 2024, a year-on-year increase of 0.6%, and a net profit attributable to shareholders of 671 million yuan, up 1.7% year-on-year. In Q3 2024, the company achieved a revenue of 657 million yuan, a year-on-year increase of 6.8%, and a net profit of 223 million yuan, up 17.9% year-on-year [5][6] - The revenue recovery in Q3 is attributed to improved channel layout and targeted promotions, as well as the gradual realization of optimization results. The company is expanding its product categories while focusing on existing markets and enhancing communication with distributors [5][6] - The gross margin in Q3 increased by 10.48 percentage points to 56.2%, benefiting from lower costs of raw materials and a higher proportion of high-margin products. Operating cash flow continued to grow significantly, with a year-on-year increase of 32.7% to 325 million yuan [6] Financial Summary - The company expects EPS for 2024-2026 to be 0.74, 0.81, and 0.87 yuan per share, respectively. The estimated reasonable valuation range for 2024 is 14.84-18.55 yuan based on a PE ratio of 20-25x [7][8] - The projected revenue for 2024 is 2.498 billion yuan, with a year-on-year growth of 2.0%. The net profit is expected to be 856 million yuan, reflecting a growth of 3.6% year-on-year [8][10] - The gross margin is projected to improve to 52.7% in 2024, with a net profit margin of 34.3% [10][11]