China National Gold (SH:600916) KAIYUAN SECURITIES·2025-05-12 11:58Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The company demonstrated stable operations in 2024, but faced significant pressure in Q1 2025 due to factors such as gold price fluctuations and a sluggish consumer environment. The revenue for 2024 was CNY 604.64 billion, a year-on-year increase of 7.3%, while the net profit attributable to shareholders was CNY 8.18 billion, a decrease of 15.9%. In Q1 2025, revenue dropped to CNY 110.03 billion, down 39.7%, and net profit fell to CNY 1.35 billion, down 63.0%. The profit forecasts for 2025-2027 have been adjusted downwards, with expected net profits of CNY 9.00 billion, CNY 10.34 billion, and CNY 11.88 billion respectively [4][5][6] Financial Performance Summary - In 2024, the company's revenue from gold products was CNY 595.07 billion, reflecting a 7.3% increase. Revenue by region showed significant disparities, with North China and East China growing by 4.9% and 31.8% respectively, while South China, Central China, Southwest, Northeast, and Northwest regions experienced declines ranging from 19.3% to 37.5% [5] - The comprehensive gross margin for Q1 2025 was 5.6%, an increase of 1.6 percentage points, while the net margin was 1.2%, a decrease of 0.8 percentage points. The expense ratios for sales, management, and financial costs remained stable [5] Strategic Initiatives - The company is focusing on channel optimization and product innovation. In 2024, it closed a net total of 21 stores, bringing the total number of stores to 4,236. The franchise system is being upgraded, and the direct sales system is being tailored to local conditions. Additionally, the company is enhancing its product brand system by collaborating with cultural resources [6] - The repurchase system is being deepened to improve service innovation, focusing on refining and repurchase services to gradually reduce ineffective income and enhance gross margin levels [6] Financial Projections - The company’s projected revenues for 2025-2027 are CNY 63.60 billion, CNY 68.38 billion, and CNY 73.55 billion respectively, with year-on-year growth rates of 5.2%, 7.5%, and 7.6%. The net profit attributable to shareholders is expected to recover to CNY 900 million in 2025, with further increases in subsequent years [8][11]