DAFENG INDUSTRY(SH:603081) KAIYUAN SECURITIES·2024-10-31 14:42Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The company has shown marginal improvement in revenue quarter by quarter, with the actual controller increasing shareholding, reflecting confidence in the company's future [1] - The company reported a revenue of 1.167 billion yuan for the first three quarters of 2024, a year-on-year decrease of 31.6%, and a net profit attributable to shareholders of 53 million yuan, down 57.6% year-on-year. However, Q2 2024 saw a revenue of 507 million yuan, a year-on-year decrease of 11.18%, but a net profit of 4.66 million yuan, up 101.82% year-on-year [2][3] - The company is actively reducing high-risk projects and optimizing order structure, leading to a gradual recovery in revenue [2] - The gross margin for Q3 2024 improved to 29.1%, up 5.6 percentage points year-on-year, supported by a strong order backlog [3] - The company has secured significant contracts, including seven large cultural and tourism integration service projects, totaling 479 million yuan, which is approximately 24.7% of 2023's revenue [3] - The company is expected to benefit from the renewal of cultural and sports tourism equipment and the promotion of debt reduction policies, with an optimistic outlook on the recovery of its balance sheet and performance elasticity [2] Financial Summary - The company’s revenue is projected to decline to 1.604 billion yuan in 2024, with a year-on-year decrease of 17.2%, but is expected to rebound to 2.036 billion yuan in 2025 and 2.555 billion yuan in 2026 [5] - The net profit attributable to shareholders is forecasted to be 115 million yuan in 2024, a year-on-year increase of 14.1%, and is expected to grow to 204 million yuan in 2025 and 250 million yuan in 2026 [5] - The gross margin is expected to improve to 32.3% in 2024 and further to 33.5% in 2025 [5] - The company’s earnings per share (EPS) is projected to be 0.28 yuan in 2024, increasing to 0.50 yuan in 2025 and 0.61 yuan in 2026 [5] - The current price-to-earnings (P/E) ratio is 36.4 for 2024, decreasing to 20.6 in 2025 and 16.7 in 2026 [5]