Investment Rating - The investment rating for the company is maintained at Neutral [1] Core Insights - The company reported a revenue of Rmb2.19 billion for 1HFY25, representing a year-on-year decline of 9.3%. The adjusted net loss attributable to the parent company was Rmb4.039 million, which aligns with expectations. The revenue decline and loss were primarily due to the spin-off of the "Yuhui Tongxing" live-streaming channel [4][9] - The spin-off of the live-streaming channel negatively impacted GMV growth, with GMV for 1HFY25 at Rmb4.8 billion, down 15.8% year-on-year. The GMV composition included Rmb1.77 billion from self-operated products and Rmb3.03 billion from third-party product sales. Following the spin-off, the company is focusing on a multi-live-streaming and multi-host strategy, which has started to show signs of recovery in GMV [5][10] - Business adjustments led to a significant increase in expenses, with administrative expenses rising by 180.7% year-on-year to Rmb392 million due to a personal reward of Rmb140 million given to Dong Yuhui. Marketing expenses also increased by 24.3% year-on-year to Rmb459 million. The profit margin for 1HFY25 recovered to 4.4%, a decrease of approximately 13.7 percentage points compared to the same period last year [6][11] Financial Data and Profit Forecast - The company’s revenue projections for FY25 to FY27 are Rmb4.717 billion, Rmb5.035 billion, and Rmb5.448 billion, respectively, with a forecasted decline of 27.71% in FY25 [7] - The adjusted net profit attributable to the parent company is projected to be Rmb245 million, Rmb382 million, and Rmb440 million for FY25, FY26, and FY27, respectively [12] - The target price is maintained at HK$13.9 [12]
东方甄选：费用增长见顶，静待经营效率提升