WEIXING(SZ:002003) Orient Securities·2024-11-01 06:13Investment Rating - The report maintains a "Buy" rating for the company with a target price of 19.23 yuan, reflecting an optimistic outlook based on adjusted earnings forecasts for 2024-2026 [3][7]. Core Insights - The company reported a revenue of 3.58 billion yuan for the first three quarters of 2024, representing a year-on-year growth of 23.3%, while the net profit attributable to the parent company was 624 million yuan, up 17.15% year-on-year. However, the net profit for Q3 showed a decline of 9.9% due to changes in bonus accrual policies [2][3]. - Revenue growth was driven by strong performance in product segments, with zippers, buttons, and other apparel accessories showing year-on-year growth rates of 24%, 27.1%, and 23.2% respectively in the first half of 2024. The company anticipates continued growth of around 20% in the button and zipper businesses for Q3 [2]. - Geographically, domestic and overseas revenues grew by 24.8% and 27.2% respectively in the first half of 2024, with expectations that overseas markets will become the main growth driver in Q3 and beyond [2]. - The gross margin for Q3 improved by 2.1 percentage points to 44.3%, attributed to increased capacity utilization and internal efficiency, despite a rise in expense ratios due to the new bonus accrual method [2]. Financial Summary - The company adjusted its earnings forecasts, projecting earnings per share of 0.61, 0.73, and 0.84 yuan for 2024, 2025, and 2026 respectively, with a DCF valuation corresponding to a target price of 19.23 yuan [3][7]. - Key financial metrics include projected revenues of 4.679 billion yuan in 2024, with a year-on-year growth of 19.8%, and a net profit of 718 million yuan, reflecting a growth of 28.7% [5][10]. - The gross margin is expected to improve to 41.9% in 2024, with net profit margins projected to reach 15.3% [5][10].