SPM(SH:601900) HTSC·2025-04-27 08:56Investment Rating - The report maintains a "Buy" rating for the company with a target price of 20.00 RMB [8][9]. Core Insights - The company reported a revenue of 9.172 billion RMB for 2024, a year-over-year decrease of 2.07%, primarily due to a reduction in themed educational publications and a decline in lower-margin products [2][5]. - The net profit attributable to the parent company for 2024 was 809.81 million RMB, down 36.91% year-over-year, while the non-recurring net profit increased by 5.6% to 941 million RMB [1][2]. - In Q1 2025, the company achieved a revenue of 2.113 billion RMB, reflecting a year-over-year increase of 1.21%, and a net profit of 320 million RMB, up 110.25% year-over-year [1][2]. Summary by Sections Financial Performance - The company’s gross margin improved to 33.54% in 2024, an increase of 1.71 percentage points year-over-year, attributed to lower paper costs and optimized management expenses [2]. - For Q1 2025, the gross margin further increased to 38.16%, up 4.12 percentage points year-over-year, driven by price increases in educational materials and continued reductions in paper costs [2]. Digital Development - The company has established a regular supply mechanism for digital textbooks, becoming the first in Guangdong to implement pricing for digital textbooks [3]. - The issuance of the "Yue High School" and "Language Fun Learning" cards exceeded 12.32 million, marking a year-over-year growth of over 59% [3]. Publishing and Reform - In 2024, the company published 5,291 types of popular books, 193 audio-visual products, and 453 electronic publications, with general book sales reaching 4.247 billion RMB, a growth of 51.61% [4]. Profit Forecast and Valuation - The forecast for net profit attributable to the parent company is adjusted to 1.12 billion RMB for 2025, reflecting a 38.33% increase year-over-year [5]. - The company is valued at a PE ratio of 16X for 2025, with a target price of 20 RMB, indicating a potential upside from the current market price [5].