M&G(603899)2025-05-04 07:27Investment Rating - The investment rating for the company is "Buy" and is maintained [7]. Core Insights - In Q1 2025, the company achieved total revenue of 5.245 billion yuan, a year-on-year decrease of 4%. The net profit attributable to shareholders was 318 million yuan, down 16% year-on-year, while the net profit excluding non-recurring items was 281 million yuan, a decline of 14% year-on-year [2][4][9]. Summary by Sections Financial Performance - The company reported total revenue of 5.245 billion yuan in Q1 2025, with a year-on-year decline of 4%. The net profit attributable to shareholders was 318 million yuan, reflecting a 16% decrease year-on-year. The net profit excluding non-recurring items was 281 million yuan, down 14% year-on-year [2][4][9]. - The comprehensive gross margin for Q1 2025 was 20.65%, an increase of 0.5 percentage points year-on-year, attributed to the improvement in gross margin from traditional core businesses [9]. Business Segments - Traditional core business (excluding M&G Technology) saw a revenue decline of 9% year-on-year in Q1 2025, with specific product categories like writing tools, student stationery, and office supplies experiencing slight declines in revenue [9]. - M&G Technology continued to grow rapidly, with a revenue increase of 25% year-on-year in Q1 2025, and the net loss is expected to narrow compared to the previous year [9]. - Retail stores reported a revenue growth of 8% year-on-year in Q1 2025, with specific brands like Jiumu showing an 11% increase in revenue [9]. Future Outlook - The company expects to see continued growth in overseas business and improvements in profitability from retail stores through the introduction of IP-derived products [9]. - Forecasted net profits for the years 2025 to 2027 are 1.54 billion yuan, 1.70 billion yuan, and 1.85 billion yuan, respectively, with corresponding price-to-earnings ratios of 18, 16, and 15 times [9].