HEILAN HOME(SH:600398) ZHESHANG SECURITIES·2025-07-04 14:32Investment Rating - The investment rating for the company is "Buy" [6] Core Views - The main brand of the company is expected to stabilize and recover, with a significant improvement in sales trends anticipated in the upcoming quarters [2] - The expansion of the JD Outlet is expected to accelerate, with a strong long-term growth momentum [3] - The company is characterized by high dividend yields, with a stable performance in its main brand leading the industry [1] Summary by Sections Investment Highlights - The company is recognized as the leading men's apparel brand with high dividends, and its main brand is performing steadily, outpacing peers [1] Positive Surprises - The main apparel business is expected to stabilize and rebound, with a forecasted reduction in revenue decline for the main brand in Q4 2024 and Q1 2025, leading to a potential year-on-year revenue increase [2] - The JD Outlet's expansion is anticipated to accelerate in the second half of the year, with a significant number of new stores expected to open [3] Driving Factors - Improvement in the main brand's revenue is expected to enhance profit margins, leading to a steady increase in net profit and attractive dividend yields [4] - The accelerated opening of JD Outlet stores and the gradual refinement of the single-store model are expected to boost market confidence and valuation [4] Earnings Forecast - Revenue is projected to reach 22.3 billion, 24.8 billion, and 26.6 billion yuan for 2025, 2026, and 2027 respectively, with year-on-year growth rates of 6.5%, 11.1%, and 7.4% [4] - Net profit is expected to be 2.41 billion, 2.66 billion, and 2.91 billion yuan for the same years, with growth rates of 11.7%, 10.4%, and 9.2% [4] Valuation Analysis - The company is expected to achieve a net profit exceeding 2 billion yuan in 2025, with a target price-to-earnings (PE) ratio of 14, leading to an estimated market value of around 30 billion yuan [5] - The new JD Outlet business is projected to contribute approximately 1 billion yuan to net profit within three years, with a target PE of 20, resulting in an estimated market value of around 20 billion yuan [5]