YILI(SH:600887) HTSC·2025-04-30 07:00Investment Rating - The report maintains a "Buy" rating for the company with a target price of 36.33 RMB [7][8]. Core Insights - The company's performance in Q1 2025 exceeded expectations, with significant improvements in gross profit margin and a positive outlook for revenue growth in 2025 [1][4]. - The liquid milk business showed a narrowing decline in revenue, while the infant formula segment continued to perform strongly, indicating competitive advantages [2][3]. - The company plans to achieve a revenue target of 119 billion RMB in 2025, representing a year-on-year increase of 2.8%, and a profit target of 12.6 billion RMB, reflecting a 24.4% increase [1][4]. Summary by Sections Financial Performance - In 2024, the company's revenue, net profit attributable to the parent, and net profit excluding non-recurring items were 115.78 billion RMB, 8.45 billion RMB, and 6.01 billion RMB, respectively, showing declines of 8.2%, 18.9%, and 40.0% year-on-year [1]. - For Q1 2025, the company reported revenues of 33.02 billion RMB, a net profit of 4.87 billion RMB, and a net profit excluding non-recurring items of 4.63 billion RMB, with year-on-year changes of +1.4%, -17.7%, and +24.2% respectively [1][2]. Business Segments - In 2024, the revenue breakdown by product category was 750 billion RMB for liquid milk, 87.2 billion RMB for cold drinks, and 296.8 billion RMB for milk powder and dairy products, with year-on-year changes of -12.3%, -18.4%, and +7.5% [2]. - In Q1 2025, the revenue for liquid milk, cold drinks, and milk powder and dairy products was 196.4 billion RMB, 41.1 billion RMB, and 88.1 billion RMB, with year-on-year changes of -3.1%, -5.3%, and +18.6% respectively [2]. Profitability Metrics - The gross profit margin for 2024 was 34.1%, with a year-on-year increase of 1.3 percentage points, while the gross profit margin for Q1 2025 improved to 37.8%, reflecting a year-on-year increase of 1.8 percentage points [3]. - The company reported a net profit margin of 14.0% in Q1 2025, which is the highest in its history, driven by improved gross profit and reduced selling expenses [3]. Future Projections - The company expects to achieve an EPS of 1.73 RMB in 2025, with projected growth rates of 30.51% and 10.66% for the following years [6][4]. - The report anticipates a continued positive trend in profitability and revenue growth, supported by strategic adjustments in product offerings and market positioning [1][4].