M&G(SH:603899) Tianfeng Securities·2025-05-07 08:23Investment Rating - The report maintains a "Buy" rating for the company, expecting a relative return of over 20% within the next six months [6][17]. Core Insights - The company reported a revenue of 5.245 billion in Q1 2025, a year-on-year decrease of 4.4%, and a net profit attributable to shareholders of 318 million, down 16.2% year-on-year. The gross margin improved to 20.65%, an increase of 0.5 percentage points [1][5]. - The company is actively promoting IP and overseas business development, with expectations for operational improvements as the external business environment stabilizes [1][2]. - The traditional core business revenue was approximately 2.05 billion, reflecting a decline of about 5% due to a weak external environment, but the company is focusing on product enhancement and multi-channel strategies [2][3]. Summary by Sections Q1 2025 Performance - The company achieved a revenue of 5.245 billion, with a net profit of 318 million, and a non-recurring net profit of 281 million, showing declines of 16.2% and 14.2% respectively year-on-year [1]. - The gross margin was 20.65%, with a net profit margin of 6.07%, indicating a slight decrease of 0.9 percentage points [1]. Product Revenue Breakdown - Writing tools generated 564 million in revenue, down 0.07%, with a gross margin of 43.78% - Student stationery revenue was 803 million, down 5.99%, with a gross margin of 35.63% - Office stationery revenue was 849 million, down 5.60%, with a gross margin of 28.48% [1]. Traditional Core Business - The traditional business revenue, excluding specific segments, was about 2.05 billion, down approximately 5%. The company is enhancing product capabilities and expanding its multi-channel layout [2]. Online and Overseas Business - Online revenue for the company reached 310 million, a year-on-year increase of 25%, driven by strategic partnerships and product line expansions [2]. - The overseas market continues to grow rapidly, with a focus on meeting diverse consumer needs [2]. KeliPu Segment - KeliPu's revenue was 2.79 billion, down 5.32% due to high base effects and delays in product launches. The focus will be on developing core and proprietary products and expanding the customer base [3]. Retail Stores - The revenue from retail stores was 401 million, up 8.03%, with a total of 792 retail stores nationwide, an increase of 13 from the previous year [4]. Profit Forecast Adjustments - The profit forecast for 2025-2027 has been adjusted to 1.56 billion, 1.74 billion, and 1.94 billion respectively, with corresponding PE ratios of 18X, 16X, and 15X [5].