GREE(000651) Guolian Securities·2024-11-01 06:30Investment Rating - The investment rating for Gree Electric Appliances is "Buy (Maintain)" [4] Core Views - Gree Electric Appliances reported a revenue of 46.939 billion yuan in Q3 2024, a year-on-year decline of 15.84%, while the net profit attributable to shareholders was 7.825 billion yuan, an increase of 5.47% year-on-year. The company is experiencing short-term revenue pressure but has significantly improved its profitability. The "old-for-new" policy is expected to boost retail sales of air conditioners, leading to potential improvements in Q4 [2][6][4]. Summary by Sections Financial Performance - For the first three quarters of 2024, Gree Electric achieved a total revenue of 146.722 billion yuan, down 5.34% year-on-year, with a net profit of 21.961 billion yuan, up 9.30% year-on-year. In Q3 alone, revenue was 46.939 billion yuan, down 15.84% year-on-year, while net profit was 7.825 billion yuan, up 5.47% year-on-year [6][2]. - The company's gross margin in Q3 2024 decreased by 0.5 percentage points, influenced by cost pressures and a shift in sales structure, with domestic sales margins higher than export margins. The net profit margin increased by 3.4 percentage points to 16.7% [6][10]. Market Outlook - The report indicates that Gree's channel inventory may further decrease, and recent retail data for air conditioners has shown improvement due to the "old-for-new" policy. The company is expected to see better performance in Q4 [2][6]. - The projected earnings for 2024 and 2025 are 32 billion yuan and 35.5 billion yuan, respectively, with corresponding price-to-earnings ratios of 8.0 and 7.2 times [6][7]. Valuation Metrics - As of the report date, Gree Electric's current price is 45.78 yuan, with a market capitalization of approximately 252.497 billion yuan. The company has a total share capital of 5.601 billion shares and a debt-to-asset ratio of 65.05% [4][6].