QIANHE(603027) Guotai Junan Securities·2024-11-02 06:23Investment Rating - The report maintains a "Buy" rating for Qianhe Flavor Industry (603027) [3][5] Core Views - The company is experiencing temporary pressure on performance due to weak demand, but is expected to rebound in the medium to long term through product optimization and channel expansion [2][3] - The company's Q3 2024 results were below market expectations, with revenue of 2.288 billion yuan, down 1.85% year-on-year, and a net profit of 352 million yuan, down 9.19% year-on-year [3] - Despite short-term growth challenges, the company's brand positioning in healthy condiments aligns with long-term trends in health-conscious eating, which is expected to support future growth [3] Financial Summary - For Q3 2024, the company reported a single-quarter revenue of 699 million yuan, a decrease of 12.63% year-on-year, and a net profit of 101 million yuan, down 22.58% year-on-year [3] - The gross margin for Q3 2024 was 37.54%, an increase of 0.67 percentage points year-on-year, primarily due to declining costs, while the net margin was 14.45%, a decrease of 1.85 percentage points year-on-year [3] - The company has revised its EPS forecasts for 2024-2026 to 0.49, 0.55, and 0.63 yuan, reflecting year-on-year changes of -5.2%, +12.4%, and +15.3% respectively [3][4] Valuation - The target price for the company is set at 15.68 yuan, based on a 2025 PE ratio of 28.5x, referencing comparable companies such as Haitian Flavor Industry and Tianwei Food [3][5] - The current market capitalization of Qianhe Flavor Industry is approximately 12.477 billion yuan [5]