YILI(SH:600887) CSC SECURITIES (HK) LTD·2025-04-30 05:23Investment Rating - The investment rating for the company is "Buy" with a target price of 34 CNY, indicating a potential upside from the current price of 28.79 CNY [4][5]. Core Insights - The company reported a revenue of 115.78 billion CNY in 2024, a decrease of 8.2% year-on-year, and a net profit of 8.45 billion CNY, down 19% year-on-year. However, in Q1 2025, the company achieved a revenue of 33.02 billion CNY, reflecting a 1.4% year-on-year increase, and a net profit of 4.87 billion CNY, down 17.7% year-on-year, but with a significant increase in non-recurring profit [5][6]. - The company has a diversified product portfolio, with liquid milk accounting for 59.98%, milk powder and dairy products 26.92%, and frozen products 12.54% of total revenue [2]. - The company plans to distribute a cash dividend of 12.2 CNY per 10 shares, resulting in a dividend yield of approximately 4.24% [5]. Financial Performance Summary - In 2024, the company experienced a significant decline in performance due to a combination of factors including a decrease in birth rates and intensified industry competition, leading to a goodwill impairment of 3.04 billion CNY [6]. - The company expects gradual improvement in performance from 2025 to 2027, with projected net profits of 10.71 billion CNY, 12.18 billion CNY, and 13.40 billion CNY, representing year-on-year growth rates of 26.7%, 13.8%, and 10% respectively [8]. - The earnings per share (EPS) for the same period are projected to be 1.68 CNY, 1.91 CNY, and 2.11 CNY, with corresponding price-to-earnings (P/E) ratios of 17, 15, and 14 [8][9].