Anjoy food(SH:603345) Southwest Securities·2024-11-06 10:27Investment Rating - The report maintains a "Buy" rating for the company with a target price of 109.63 CNY over the next six months [1][4]. Core Insights - The company reported a revenue of 11.08 billion CNY for the first three quarters of 2024, reflecting a year-on-year increase of 7.8%, while the net profit attributable to shareholders was 1.05 billion CNY, down 6.7% year-on-year. In Q3 2024, revenue reached 3.53 billion CNY, up 4.6% year-on-year, but net profit fell by 36.8% to 240 million CNY [1][2]. Summary by Sections Business Performance - In Q3 2024, the company’s revenue from frozen prepared foods, frozen dishes, and frozen noodles was 1.79 billion CNY, 1.13 billion CNY, and 530 million CNY respectively, showing a year-on-year change of -0.1%, +24.1%, and -9.5%. The growth in the dish segment was attributed to the success of brands like Anjiu Kitchen and Frozen Products [2]. Profitability - The gross margin for Q3 2024 was 22.6%, an increase of 0.6 percentage points year-on-year, while the net profit margin decreased by 4.6 percentage points to 7%. The decline in profitability was mainly due to increased promotional expenses driven by intensified market competition [3]. Future Outlook - The company is focusing on a product strategy of "strengthening staple foods and launching main dishes" and aims to maintain a "high quality, mid-price" pricing strategy. The upcoming cold season is expected to boost performance as the demand for frozen products typically increases [3]. Earnings Forecast - The projected earnings per share (EPS) for 2024, 2025, and 2026 are 4.91 CNY, 5.77 CNY, and 6.73 CNY respectively, with corresponding dynamic price-to-earnings (PE) ratios of 18, 15, and 13. The target price of 109.63 CNY is based on a 19x valuation for 2025 [4][8].