Investment Rating - The report initiates coverage with a "Buy" rating for the company [5][6][48] Core Views - The company is a global leader in garment manufacturing, providing comprehensive production solutions for renowned brands since its establishment in 1970 [1][11] - The company has shown steady improvement in profitability, with a compound annual growth rate (CAGR) of 0.24% in revenue and 5.64% in net profit from 2019 to 2024, indicating a recovery phase in 2024 [2][19] - The company has adopted a co-creation business model, enhancing collaboration with high-quality clients and providing value-added services [3][31] Summary by Sections Company Overview - The company operates approximately 20 modern factories across five countries, employing nearly 80,000 people and producing over 470 million garments annually [1][11] - It has established long-term partnerships with major brands like UNIQLO, UA, and Levi's, contributing to its industry-leading position [1][11] Financial Performance - In 2024, the company achieved total revenue of $2.47 billion, a year-on-year increase of 11.8%, and a net profit of $200 million, up 22.7% [2][19] - The gross margin improved from 19.1% in 2019 to 19.7% in 2024, while the net margin increased from 6.2% to 8.1% during the same period [22][24] Co-Creation Business Model - The co-creation model allows the company to provide comprehensive services from market trend analysis to logistics, enhancing product development efficiency [3][31] - This model has led to significant advantages, such as reduced product development time and lower raw material costs [32][36] 2025 Outlook - The company is optimistic about achieving significant performance breakthroughs in 2025, supported by strong demand from core clients [4][42] - It plans to expand production capacity in mid-2024 to meet increasing order volumes, with a focus on maintaining strict cost control [4][43] Revenue and Valuation Forecast - Revenue projections for 2025-2027 are $2.74 billion, $3.01 billion, and $3.30 billion, respectively, with net profits expected to be $230 million, $270 million, and $310 million [5][44][46] - The target price is set at HKD 7.60, based on a 12x price-to-earnings ratio [5][48]
晶苑国际（02232）：客户优势显现，乐观预期2025