YILI(SH:600887) KAIYUAN SECURITIES·2024-11-03 15:30Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The company's Q3 2024 profit exceeded expectations, indicating a potential for steady improvement in profitability [3] - For the first three quarters of 2024, the company reported a revenue of 887.3 billion yuan, a year-on-year decrease of 8.6%, while the net profit attributable to shareholders was 108.68 billion yuan, an increase of 15.9% year-on-year [3] - The report maintains net profit forecasts for 2024-2026 at 116.8 billion, 115.6 billion, and 126.0 billion yuan, with corresponding EPS of 1.83, 1.82, and 1.98 yuan, respectively [3] Financial Performance Summary - In Q3 2024, the company achieved a revenue of 290.4 billion yuan, down 6.7% year-on-year, and a net profit of 33.37 billion yuan, up 8.5% year-on-year [3] - The company's gross margin improved to 34.9%, an increase of 2.5 percentage points year-on-year, primarily due to lower raw milk costs and recovery in product prices following channel adjustments [5] - The net profit margin for Q3 2024 was 11.4%, up 1.6 percentage points year-on-year, while the non-recurring net profit margin was 11.0%, up 2.4 percentage points year-on-year [5] Business Segment Performance - The liquid milk, milk powder, and ice cream segments saw year-on-year changes of -10.3%, +6.6%, and -16.7%, respectively, in Q3 2024 [4] - The liquid milk segment remains the industry leader, with strong performance in organic milk and double-digit growth in low-temperature milk [4] - The milk powder segment continued its growth trend, with infant formula experiencing double-digit growth [4] Future Outlook - The company expects liquid milk demand to recover in Q4 2024 due to the implementation of policies promoting milk consumption and pre-holiday stocking ahead of the 2025 Spring Festival [4] - The report anticipates that the gross margin will continue to be supported by declining raw milk costs, with overall profitability expected to improve as revenue rebounds [5]