OPPEIN(SH:603833) Guoxin Securities·2024-11-05 02:41Investment Rating - The investment rating for the company is "Outperform the Market" [3][12]. Core Views - The company has experienced a decline in revenue but a significant improvement in profitability, attributed to reforms in delivery quality and supply chain management. The implementation of the old-for-new furniture policy in Q4 is expected to enhance consumer purchasing willingness and release pent-up demand [1][3]. - Direct sales channels have shown steady growth, while distribution and bulk business have declined due to reduced terminal traffic and the impact of the housing market. The company is optimizing underperforming stores and encouraging distributors to adopt a comprehensive home furnishing strategy [1][3]. - The company has seen a rise in gross margins across various product categories, particularly in wardrobes and wooden doors, due to changes in product structure and cost control measures [1][3]. Summary by Sections Financial Performance - For the first three quarters of 2024, the company reported revenue of 13.88 billion, down 16.2% year-on-year, and a net profit attributable to shareholders of 2.03 billion, down 12.1% [1]. - In Q3 2024, revenue was 5.30 billion, a decrease of 21.2%, while net profit was 1.04 billion, down 11.6% [1]. - The gross margin for Q3 2024 improved to 40.4%, an increase of 2.7 percentage points, driven by product structure changes and cost control measures [1][3]. Revenue Breakdown - Revenue from direct sales for Q1-Q3 2024 was 530 million, up 4.1%, while distribution revenue was 10.39 billion, down 18.9% [1]. - The revenue from various product categories showed declines: wardrobes at 7.19 billion (-19.0%), cabinets at 4.03 billion (-22.0%), wooden doors at 830 million (-17.1%), and bathrooms at 800 million (-1.6%) [1]. Profitability Metrics - The company’s net profit margin for Q3 2024 was 19.7%, an increase of 2.2 percentage points, reflecting a focus on profit and quality growth [1][3]. - The projected net profit for 2024-2026 is expected to be 2.73 billion, 2.94 billion, and 3.14 billion respectively, with corresponding PE ratios of 15.6, 14.5, and 13.6 [1][2].