SCSF(SH:600779) GUOTAI HAITONG SECURITIES·2025-05-15 07:13Investment Rating - The report maintains an "Accumulate" rating for the company with a target price of 58.34 CNY [5][11]. Core Insights - Despite industry demand pressures, the company achieved positive revenue and profit growth in Q1 2025. The company is actively building a dual-brand system with "Shuijingfang" for mid-to-high-end products and "Diyifang" for high-end products, while embracing new retail channels [2][11]. - The company demonstrated strong operational resilience in a weak demand environment, with projected EPS for 2025-2027 at 2.92, 3.08, and 3.28 CNY respectively [11][12]. Financial Summary - Revenue for 2023 was 4,953 million CNY, with a growth of 6.0%. For 2024, revenue is projected to be 5,217 million CNY (+5.3%), and for 2025, it is expected to reach 5,441 million CNY (+4.3%) [4][12]. - Net profit attributable to the parent company for 2023 was 1,269 million CNY, with a growth of 4.4%. The projections for 2024 and 2025 are 1,341 million CNY (+5.7%) and 1,422 million CNY (+6.0%) respectively [4][12]. - The company’s gross profit margin for 2024 is expected to be 82.8%, with a net profit margin of 25.7% [11][12]. Brand and Channel Strategy - The company plans to launch a second distinct product under the "Shuijingfang" brand and focus on the high-end market with the "Diyifang" brand, targeting products priced above 800 CNY [11]. - The company has initiated O2O new retail operations, collaborating with major platforms like Meituan and JD to enhance its distribution channels [11]. Cost Management and Profitability - In 2024, the company’s gross margin decreased by 0.4 percentage points to 82.8%, while the net profit margin increased by 0.1 percentage points to 25.7% [11]. - In Q1 2025, the company improved its gross margin by 1.5 percentage points, indicating effective cost management [11].