LZLJ(SZ:000568) Haitong Securities International·2025-05-15 09:04Investment Rating - The report maintains an "OUTPERFORM" rating for the company with a target price of Rmb205.00, while the current price is Rmb130.14 [2][8]. Core Views - The company has shown resilience during industry adjustments, with a focus on steady revenue growth and high-end product transformation [3][11]. - The Baijiu industry is experiencing a new adjustment phase, with the top five companies capturing a significant market share [11][12]. - The company has achieved a compound annual growth rate (CAGR) of 18.3% in revenue and 27.9% in net profit over the past ten years, indicating strong financial performance [12][14]. Financial Performance - Revenue projections for 2025-2027 are Rmb32 billion, Rmb34.1 billion, and Rmb36.5 billion, respectively, with net profits expected to be Rmb13.6 billion, Rmb14.5 billion, and Rmb15.4 billion [14]. - The company has maintained a high gross profit margin, which was 87.5% in 2024, ranking second in the industry [13][14]. - The dividend payout ratio is projected to be 65% in 2024, with a commitment to increase it to 70% and 75% in subsequent years, enhancing shareholder returns [14]. Market Context - The overall Chinese stock market has shown resilience, with three main factors driving this: continuous policy support, the return of international capital, and recovery in economic fundamentals [3][10]. - The allocation of Baijiu stocks has improved, with a slight increase in holdings among leading companies [10][11]. Strategic Focus - The company aims for steady progress in revenue, with specific targets for its flagship brands, including Guojiao 1573, which is expected to maintain a strong market position [11][12]. - The transformation towards high-end products has significantly increased their revenue share, indicating a successful strategic shift [12][14].