家家悦点评报告：传统修复，调改加速

Investment Rating - The investment rating for the company is "Buy" (maintained) [5] Core Views - The company is a leading offline retailer in Shandong, undergoing business transformation and upgrades, with accelerated loss reduction in provinces outside its core area, and new business formats opening up growth opportunities [1] - The retail sector is expected to recover, with CPI for consumer goods likely turning positive year-on-year in Q3-Q4 2024, which may drive same-store sales growth [2] - The company is shifting from price competition to experience enhancement, with store renovations expected to boost sales [3] - The company has seen significant improvement in revenue and profitability from its operations outside its core region, with a notable increase in gross margin [4] - New business formats are being tested and expanded, including discount and bakery stores, which are expected to contribute positively to profitability [5][12] Summary by Sections Business Transformation and Upgrades - The company is focusing on upgrading its main business, with expectations for same-store sales recovery as the macroeconomic environment improves [2] - Store renovations have led to a reduction in homogenized products and an introduction of personalized items, enhancing customer experience and potentially increasing foot traffic and daily sales [3] Loss Reduction in Outlying Provinces - The company has adjusted its strategy to improve profitability in provinces like Inner Mongolia and Hebei, with revenue from these areas showing an 8.29% year-on-year increase [4] - Significant improvements in profitability have been noted, particularly in Inner Mongolia, where profits increased by 240% year-on-year [4] New Business Formats - The company is rapidly testing new business formats, including discount stores and bakeries, which are expected to enhance profitability [5][12] - The discount model is being implemented alongside a bakery brand, which has expanded to 50 stores nationwide, focusing on high-quality, cost-effective products [13] Financial Forecast and Valuation - Revenue projections for 2024-2026 are estimated at 182.69 billion, 194.83 billion, and 202.36 billion yuan, with corresponding net profits of 2.28 billion, 2.79 billion, and 3.35 billion yuan [15] - The company is expected to maintain a price-to-earnings ratio of 32X, 26X, and 22X for the respective years, with a target market value of 111 billion yuan by 2025, indicating a potential upside of approximately 55% [15]