Shede Spirits (SH:600702) Huaxin Securities·2025-05-07 08:23Investment Rating - The report maintains a "Buy" investment rating for the company [7] Core Views - The company's performance is under pressure, with expectations for a recovery in elasticity as the economy stabilizes [5][7] - The first quarter of 2025 saw total revenue and net profit attributable to shareholders at 1.576 billion and 346 million yuan, respectively, reflecting year-on-year declines of 25% and 37% [5] - The company is experiencing a shift in product structure leading to a decline in gross margin, while management expenses are being optimized [5] - E-commerce channels have shown strong performance, with sales growth of 37% year-on-year, while wholesale and agency sales declined by 32% [6] - The company is focusing on developing its domestic market, particularly in regions like Suining, which has resulted in a notable increase in revenue contribution from these areas [6] Summary by Sections Performance Overview - The company reported a significant decline in revenue and profit in Q1 2025, with gross margin at 69% and net margin at 22%, both down year-on-year [5] - Operating cash flow increased significantly, with a year-on-year growth of 107% [5] Sales Channels - E-commerce sales accounted for 14.21% of total revenue, up 7 percentage points year-on-year, while traditional sales channels faced declines [6] Regional Performance - Revenue from the domestic market was 4.94 billion yuan, down 9% year-on-year, while revenue from outside the province fell by 33% [6] Earnings Forecast - The company is expected to recover as business scenarios improve, with adjusted EPS forecasts for 2025-2027 at 2.10, 2.84, and 3.61 yuan, respectively [7] - The current stock price corresponds to a PE ratio of 28, 20, and 16 for the years 2025, 2026, and 2027 [7]