HOLIKE(603898) Huachuang Securities·2024-11-06 05:23Investment Rating - The report maintains a "Strong Buy" rating for the company, with a target price of 10.63 CNY per share, compared to the current price of 8.63 CNY [4][2]. Core Views - The company's revenue and net profit have faced significant pressure, with a year-over-year decline in revenue of 11.2% and a net profit drop of 48.9% for the first three quarters of 2024. In Q3 2024, revenue was 5.2 million CNY, down 20.4% year-over-year, while net profit decreased by 50.8% [1][2]. - The company is actively pushing for channel transformation and optimizing its store system, with a notable increase in the bulk channel revenue, which grew by 71.1% year-over-year in Q3 2024. This growth is attributed to the focus on state-owned enterprises and quality private enterprises [1][2]. - The report anticipates a recovery in performance driven by the gradual impact of the "old-for-new" policy on demand, projecting net profits of 1.49 billion CNY, 1.74 billion CNY, and 1.96 billion CNY for 2024, 2025, and 2026, respectively [2][3]. Financial Summary - For the first three quarters of 2024, the company reported total revenue of 1.44 billion CNY, with a net profit of 90 million CNY and a non-recurring net profit of 60 million CNY, reflecting a year-over-year decline of 11.2%, 48.9%, and 51.1%, respectively [1][2]. - The gross margin for Q3 2024 was 34.0%, down 3.3 percentage points year-over-year, while the net profit margin was 8.9%, a decrease of 5.5 percentage points [2]. - The company’s total revenue is projected to be 2.076 billion CNY in 2024, with a year-over-year decline of 8.3%, followed by a recovery in 2025 and 2026 with expected growth rates of 9.1% and 8.1%, respectively [3][6].