Jason Furniture (Hangzhou) (SH:603816) HTSC·2025-04-29 06:40Investment Rating - The investment rating for the company is maintained as "Buy" with a target price of RMB 31.92 [7][8]. Core Views - The company reported a revenue of RMB 18.48 billion for 2024, a year-on-year decrease of 3.8%, and a net profit attributable to shareholders of RMB 1.42 billion, down 29.4% year-on-year, primarily due to asset and credit impairment losses of RMB 306 million [1][2]. - The first quarter of 2025 showed a strong start with revenue of RMB 4.91 billion, up 12.9% year-on-year, and a net profit of RMB 520 million, up 23.5% year-on-year, driven by growth in both domestic and foreign trade [1][2]. - The company expects a recovery in demand due to the implementation of domestic real estate policies and trade-in programs, which should support domestic sales performance [1][4]. Summary by Sections Financial Performance - In 2024, the company's gross margin decreased by 0.11 percentage points to 32.7%, attributed to a lower proportion of high-margin domestic business and increased end-user discounts [3]. - The company increased its shareholder return efforts, achieving a dividend payout ratio of 80.06% in 2024 [3]. Revenue Breakdown - Domestic trade revenue fell by 14.4% to RMB 9.36 billion in 2024, while foreign trade revenue increased by 11.3% to RMB 8.37 billion [2]. - Sofa sales grew by 9.14% to RMB 10.20 billion, driven by strong overseas demand, while bedroom product sales declined by 20.80% to RMB 3.25 billion [2]. Profit Forecast and Valuation - The company slightly lowered its revenue forecast for domestic business for 2025-2026 and introduced a profit forecast for 2027, expecting net profits of RMB 1.88 billion, RMB 2.08 billion, and RMB 2.29 billion for 2025-2027 respectively [4]. - The estimated EPS for 2025-2027 is RMB 2.28, RMB 2.53, and RMB 2.79, with a target PE of 14 times for 2025, leading to a target price of RMB 31.92 [4].