Investment Rating - The report maintains a "Buy" rating for the company with a target price of HKD 16.78 [7][8]. Core Views - The company's revenue for 2024 is projected to be HKD 11.80 billion, reflecting a year-over-year increase of 5.3%, while the net profit attributable to shareholders is expected to be HKD 1.30 billion, a decrease of 20.8% year-over-year. This is slightly below previous expectations due to increased sales and R&D expenses, as well as higher tax expenses compared to the previous year [1][4]. - The second half of 2024 shows a recovery in revenue growth, primarily driven by increased demand for closed-system products due to stricter regulations on non-compliant e-cigarettes in the U.S. and bans on disposable e-cigarettes in several European countries. The company's proprietary brand VAPORESSO is also experiencing rapid growth [1][2]. Summary by Sections Revenue and Profitability - The company's revenue for the first half of 2024 is expected to be HKD 5.04 billion, a decrease of 1.7% year-over-year, while the second half is projected to be HKD 6.76 billion, an increase of 11.2% year-over-year. The net profit for the first half is expected to be HKD 680 million, a decrease of 4.8%, and for the second half, HKD 620 million, a decrease of 33.2% [1][2]. Business Segments - The To B sales revenue for 2024 is projected to be HKD 93.2 billion, a slight decrease of 0.3% year-over-year. The first half is expected to generate HKD 39.2 billion, a decrease of 12.3%, while the second half is expected to recover with HKD 54.0 billion, an increase of 10.7% year-over-year. The U.S. market is expected to see a revenue increase to HKD 21.3 billion in the second half, a quarter-over-quarter increase of 14.6% and a year-over-year increase of 5.2% [2][3]. Cost Structure and Margins - The gross profit margin for 2024 is projected to be 37.4%, a decrease of 1.4 percentage points year-over-year, primarily due to changes in the business structure leading to increased labor and indirect costs. The selling, administrative, and R&D expense ratios are expected to be 7.8%, 7.7%, and 13.2%, respectively, with the increase in selling expenses attributed to the expansion in international markets and new product promotions [3][4]. Future Outlook - The report forecasts net profits for 2025, 2026, and 2027 to be HKD 1.59 billion, HKD 2.21 billion, and HKD 2.85 billion, respectively, with corresponding EPS of HKD 0.26, HKD 0.36, and HKD 0.46. The HNB business is expected to ramp up significantly by 2026, leading to an adjustment in valuation to a PE of 43 times for 2026 [4][6].
思摩尔国际（06969）：雾化主业积极修复，HNB弹性可期