TongQingLou Catering (SH:605108) Tianfeng Securities·2025-05-03 12:25Investment Rating - The investment rating for the company is "Buy" with a target price expected to yield over 20% relative return within six months [7][17]. Core Views - The company is expected to benefit from the recovery in banquet demand, leading to a positive impact on same-store sales and profit elasticity [1]. - The company reported a revenue of 2.52 billion yuan for 2024, a year-on-year increase of 5.1%, but a significant decline in net profit by 67.1% to 100 million yuan due to various factors including the absence of one-time compensation income from store relocation and losses from new stores [1][2]. - The company has a strong focus on expanding its restaurant and accommodation services, with plans to open new locations and upgrade existing ones, alongside a significant growth in its food business [3][4]. Financial Performance Summary - For 2024, the company expects revenue from restaurant and accommodation services to reach 2.20 billion yuan, a year-on-year increase of 12.7%, while food business revenue is projected at 310 million yuan, a substantial growth of 85.5% [3]. - The company plans to distribute a cash dividend of 1.2 yuan per 10 shares, resulting in a dividend payout ratio of 31.05% [2]. - The financial forecasts for 2025 to 2027 indicate a recovery in net profit, with estimates of 210 million yuan, 331 million yuan, and 441 million yuan respectively, reflecting a significant rebound from the 2024 figures [4][6]. Business Strategy and Outlook - The company aims to open 3-5 new restaurants and upgrade 20 existing ones in 2025, while also expanding its hotel operations and food business, particularly in the East China market [4]. - The company is focusing on the banquet dining segment, which is expected to maintain stable profitability due to its essential nature and differentiated advantages in standardization and cost-effectiveness [4]. Valuation Metrics - The projected price-to-earnings (P/E) ratios for 2025, 2026, and 2027 are 26, 17, and 13 respectively, indicating a favorable valuation outlook as earnings recover [4][6]. - The company’s market capitalization is approximately 5.56 billion yuan, with a current price of 21.37 yuan per share [8].