OPPEIN(SH:603833) Changjiang Securities·2024-11-08 06:27Investment Rating - The investment rating for the company is "Buy" and is maintained [8]. Core Views - The company's revenue and net profit for the first three quarters of 2024 were 13.879 billion and 2.031 billion yuan, respectively, representing declines of 16% and 12% year-on-year. In Q3 2024, the figures were 5.296 billion and 1.041 billion yuan, with declines of 21% and 12% [3][4]. - Despite revenue pressure, the overall performance in the integrated and retail home furnishing sectors showed resilience. The improvement in profitability in Q3 exceeded expectations, with a significant increase in gross margin attributed to cost control measures [4][5]. - The company is actively optimizing its channel structure and advancing its home furnishing transformation, which enhances operational resilience and competitiveness. The recent government subsidies for home furnishing are expected to boost demand and improve market share [4][5][6]. Summary by Sections Financial Performance - For the first three quarters of 2024, the company reported revenues of 13.879 billion yuan, a decline of 16% year-on-year, and a net profit of 2.031 billion yuan, down 12%. In Q3 alone, revenues were 5.296 billion yuan, down 21%, and net profit was 1.041 billion yuan, down 12% [3][4]. - The gross margin improved by 2.7 percentage points year-on-year in Q3, attributed to effective cost control and operational optimization [4]. Channel and Market Strategy - The company has reduced the number of physical stores by 536 this year, with a net decrease of 140 stores in Q3, bringing the total to 5,504. It is encouraging dealers to transition to a home furnishing model, with nearly 930 home furnishing stores established by the end of Q3 [4][5]. - The company is implementing five major reforms to enhance operational efficiency and adapt to the home furnishing strategy, including channel management and supply chain optimization [5]. Future Outlook - The ongoing government subsidies for home furnishing are expected to stimulate demand and enhance the company's market share. The company has established a national subsidy cooperation with the Guangzhou government, which is anticipated to yield quick results [5][6]. - The company plans to continue its home furnishing strategy while optimizing dealer support and product offerings, with a three-year dividend plan to strengthen investment value and market confidence [6].