YILI(SH:600887) Haitong Securities·2024-11-03 06:41Investment Rating - The investment rating for the company is "Outperform the Market" and is maintained [1]. Core Views - The company reported a revenue of 887.33 billion yuan for the first three quarters of 2024, a year-on-year decrease of 8.61%, while the net profit attributable to shareholders was 108.68 billion yuan, an increase of 15.87% year-on-year [5]. - In Q3 2024, the company achieved a revenue of 290.37 billion yuan, down 6.66% year-on-year, with a net profit of 33.37 billion yuan, up 8.53% year-on-year [6]. - The gross profit margin improved significantly despite a decline in revenue, primarily due to falling raw milk prices, leading to a gross profit margin increase of 1.9 percentage points year-on-year for the first three quarters [5]. - The company anticipates stable growth in annual performance with continuous improvement in profit margins [1]. Summary by Sections Financial Performance - For Q1-Q3 2024, the company reported a revenue of 887.33 billion yuan (YOY -8.61%) and a net profit of 108.68 billion yuan (YOY +15.87%) [5]. - In Q3 2024, the revenue was 290.37 billion yuan (YOY -6.66%) and the net profit was 33.37 billion yuan (YOY +8.53%) [6]. - The gross profit margin for Q3 2024 increased by 2.48 percentage points year-on-year, despite a revenue decline [6]. Product Performance - In Q3 2024, revenue from liquid milk was 206.37 billion yuan (YOY -10.31%), milk powder and dairy products generated 68.21 billion yuan (YOY +6.56%), and ice cream products brought in 10.21 billion yuan (YOY -16.65%) [6]. Regional Performance - Revenue by region in Q3 2024: East China 46.04 billion yuan (YOY -5.54%), South China 75.41 billion yuan (YOY +0.03%), Central China 53.79 billion yuan (YOY -16.01%), and North China 79.2 billion yuan (YOY -6.76%) [7]. Earnings Forecast - Projected revenues for 2024-2026 are 1217.36 billion yuan, 1285.66 billion yuan, and 1340.59 billion yuan, with net profits of 119.84 billion yuan, 115.80 billion yuan, and 130.57 billion yuan respectively [7]. - The estimated EPS for 2024-2026 is 1.88 yuan, 1.82 yuan, and 2.05 yuan per share [7]. Valuation - The company is assigned a PE valuation of 16-20 times for 2024, resulting in a fair value range of 30.08 to 37.60 yuan per share [7].