KinLong(SZ:002791) Tianfeng Securities·2025-03-29 09:31Investment Rating - The report maintains a "Buy" rating for the company, indicating an expected relative return of over 20% within the next six months [6][18]. Core Views - The company reported a revenue of 6.638 billion yuan for 2024, a decrease of 14.92% year-on-year, and a net profit attributable to shareholders of 90 million yuan, down 72.23% year-on-year. The performance is attributed to a decline in demand in the construction hardware market due to reduced growth in real estate development investment [1][2]. - The company is expanding its product categories and deepening its distribution channels, targeting markets such as schools and hospitals for growth. Additionally, it is actively developing markets in emerging countries related to the "Belt and Road" initiative, having established 20 overseas warehouses [1][3]. - The company’s revenue from Hong Kong, Macau, Taiwan, and overseas markets reached 880 million yuan in 2024, an increase of 14.72% year-on-year, accounting for 13.3% of total revenue [1]. Financial Performance Summary - In 2024, the core product line of door and window hardware generated revenue of 2.92 billion yuan, down 18.5% year-on-year, with a gross margin of 40.1%. Other categories, including home products and other construction hardware, saw revenues of 1.08 billion yuan and 1.02 billion yuan, down 22.0% and 9.8% respectively [2]. - The average prices of raw materials such as zinc alloy and aluminum alloy increased by 8.0% and 4.9% respectively in 2024, impacting profitability. The company’s operating cash flow was 394 million yuan, a decrease of 106 million yuan year-on-year [3][12]. - The company’s total assets were reported at 9.883 billion yuan in 2024, with a debt-to-asset ratio of 39.67% [7][12]. Future Projections - The projected net profit attributable to shareholders for 2025, 2026, and 2027 is estimated at 240 million yuan, 300 million yuan, and 370 million yuan respectively, reflecting a recovery from the significant decline in 2024 [1][12]. - The company expects to achieve a revenue growth rate of 8.71% in 2025, followed by 7.92% in 2026 and 7.14% in 2027 [12][13].