BAIRUN CORPORATION(SZ:002568) Orient Securities·2025-06-01 07:29Investment Rating - The report upgrades the investment rating to "Buy" with a target price of 36.18 CNY, reflecting a reasonable valuation level of 27 times the earnings per share for 2027 [4][5]. Core Views - The company is expected to experience a second growth curve, driven by its dual attributes in beverages and small category wines, particularly in the whiskey market, which is still in its early stages in China [2][3]. - The report predicts earnings per share of 0.81 CNY, 1.00 CNY, and 1.34 CNY for the years 2025, 2026, and 2027 respectively, indicating a positive growth trajectory [4]. Financial Summary - Revenue projections for 2025, 2026, and 2027 are 3,634 million CNY, 4,288 million CNY, and 5,410 million CNY, with year-on-year growth rates of 19.2%, 18.0%, and 26.2% respectively [4]. - Operating profit is forecasted to be 1,091 million CNY, 1,353 million CNY, and 1,774 million CNY for the same years, with growth rates of 18.1%, 24.1%, and 31.1% respectively [4]. - The net profit attributable to the parent company is expected to be 847 million CNY, 1,051 million CNY, and 1,402 million CNY, with growth rates of 17.8%, 24.0%, and 33.5% respectively [4]. - The gross margin is projected to improve from 66.7% in 2023 to 72.9% in 2027, while the net margin is expected to stabilize around 23.3% to 25.9% during the same period [4]. Market Potential - The whiskey market in China is currently underdeveloped, with only 0.8% of the total liquor market share, indicating significant growth potential as domestic brands gain traction [13][20]. - The report highlights that the domestic whiskey market is expected to grow from 55 billion CNY in 2023 to approximately 83 billion CNY by 2027, with a compound annual growth rate of 11% [39][42]. - The company aims to leverage its experience in the ready-to-drink segment to replicate its success in the whiskey market, focusing on consumer education and strategic marketing [8][36]. Strategic Positioning - The company is building a whiskey matrix with its brands, including Baileys and Laizhou, to establish itself as a leader in the domestic whiskey market [33][56]. - The report emphasizes the importance of localizing imported products to cater to Chinese consumer preferences, which has been a successful strategy in other markets [43][44]. - The company is targeting the mass market with affordable pricing strategies, which is crucial for penetrating the whiskey market in China [57].