KJS(SH:601579) Guohai Securities·2025-06-12 02:50Investment Rating - The report assigns an "Accumulate" rating for the company, marking its first coverage [2]. Core Viewpoints - The company, Kuaijishan, has shown resilience and growth in a declining yellow wine market, achieving double-digit growth in revenue and profit for two consecutive years [8][14]. - The company is focusing on a strategy of "high-end, youth-oriented, and national expansion" to break through market challenges, with significant growth in its premium product lines and innovative marketing approaches [26][30]. - The yellow wine industry is facing challenges of increasing competition and price reductions, necessitating a shift towards high-end products to sustain growth [40][43]. Summary by Sections Company Overview - Kuaijishan has a long history dating back to 1743, with a strong brand presence in the yellow wine market. The company has undergone significant changes in ownership and structure, enhancing its operational flexibility [8][13][14]. - The company has successfully transitioned to a private ownership model, which has allowed for clearer strategic direction and improved performance [16][21]. Financial Performance - The company has demonstrated a strong recovery, with revenue projected to reach 18.90 billion, 21.82 billion, and 24.98 billion yuan from 2025 to 2027, and net profit expected to be 2.45 billion, 3.06 billion, and 3.77 billion yuan respectively [8][14]. - The earnings per share (EPS) are forecasted to be 0.51, 0.64, and 0.79 yuan for the same period, with corresponding price-to-earnings (PE) ratios of 43, 34, and 28 times [8]. Market Strategy - The company is implementing a dual-brand strategy with Kuaijishan and Lanting, focusing on high-end products and youth-oriented marketing to capture a broader consumer base [22][24]. - The introduction of innovative products like the sparkling yellow wine "One Day One Smoke" has significantly boosted sales, with a reported 476% year-on-year increase [26][30]. Industry Context - The yellow wine industry has been experiencing a decline in sales revenue and profit since 2017, with a need for high-end product development to counteract this trend [40][43]. - The industry is seeing increased concentration, with the top three brands' market share rising from 21% to 50% between 2015 and 2023, indicating a shift towards consolidation and competitive positioning [50][54].