SYG(SZ:300740) KAIYUAN SECURITIES·2025-05-03 06:23Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The company has faced performance pressure due to strategic adjustments in 2024, but revenue and profit showed growth in Q1 2025. The company reported a revenue of 4.237 billion yuan in 2024, down 5.7% year-on-year, and a net profit of 110 million yuan, down 62.6% year-on-year. However, Q1 2025 saw a revenue of 1.085 billion yuan, up 5.2% year-on-year, and a net profit of 42 million yuan, up 4.7% year-on-year. The company is increasing investment in high-end brands, although the conversion effect has not met expectations, leading to losses in some mass-market brands. The profit forecasts for 2025-2026 have been revised downwards, with net profits expected to be 260 million yuan and 320 million yuan respectively, reflecting a year-on-year growth of 139% and 21% [5][6][7]. Financial Summary - In 2024, the company achieved a gross margin of 63%, benefiting from an increase in the proportion of high-margin proprietary brands. The net profit margin for 2024 was 2.6%, down 4 percentage points year-on-year. The company’s gross margin is expected to improve to 64.6% in 2025, with a projected net profit margin of 5.9% [5][7][11]. - The company’s revenue is projected to grow from 4.237 billion yuan in 2024 to 4.417 billion yuan in 2025, reflecting a year-on-year increase of 4.3%. The net profit is expected to rebound to 263 million yuan in 2025, with a significant year-on-year growth of 139% [7][10][11]. Business Strategy - The company is focusing on optimizing its business structure and enhancing its high-end brand strategy. The goal for 2025 includes improving the revenue and profitability of high-end brands while achieving breakeven for mass-market brands. The proprietary brand revenue in 2024 was 1.65 billion yuan, accounting for 39% of total revenue [6][10]. - The company plans to launch upgraded products and enhance offline sales channels, with expectations of a 20% revenue growth for high-end brands in 2025. The company is also adjusting strategies for its mass-market brand to return to profitability [6][10].