Investment Rating - The investment rating for the company is "Buy" with a target price of 446.3 HKD, indicating a potential upside of 16% from the current stock price of 387.8 HKD [1][2][3]. Core Insights - The company demonstrated resilience with a 5% year-over-year increase in total revenue to 3.07 billion USD in Q3, alongside a 4% increase in system sales. Core operating profit rose by 18%, and net profit increased by 22% to 297 million USD [2][3]. - The company has adjusted its net profit forecasts for 2024, 2025, and 2026 to 950 million, 980 million, and 1.09 billion USD respectively, with corresponding EPS estimates of 17.8, 18.3, and 20.5 HKD [2][3]. - The company has expanded its store count to 15,900, with a net addition of 438 stores in Q3, reflecting a 12.5% year-over-year growth [3]. Financial Performance Summary - Total revenue for 2023 is projected at 9.57 billion USD, with a growth rate of 14.72% expected in 2024, followed by 2.94% in 2025 and 8.87% in 2026 [5][14]. - Net profit for 2023 is estimated at 478 million USD, with a significant recovery projected in subsequent years, reaching 901 million USD in 2024 and 948 million USD in 2025 [5][14]. - The company maintains a gross margin of approximately 70%, with a net profit margin expected to stabilize around 8% in the coming years [5][15]. Valuation Analysis - The valuation methods employed include comparable company analysis and discounted cash flow (DCF) analysis, with a target price of 446.3 HKD derived from these methods, reflecting a 16.9% upside potential [7][9]. - The average PE ratio for comparable companies is projected at 18.8x for 2025, while the company is assigned a PE of 25x due to its market position and growth potential [7][9]. - The DCF analysis estimates a reasonable market value of 167.4 billion HKD, corresponding to a stock price of 434.3 HKD [7][11].
百胜中国：韧性十足，穿越周期