JONJEE(SH:600872) Haitong Securities International·2025-09-21 11:35Investment Rating - The report maintains an "Outperform" rating for Jonjee Hi-Tech Industrial and Commercial Holding with a target price of RMB 22.42, reflecting a potential upside from the current price of RMB 18.80 [2][5][13]. Core Views - Sales in core regions are showing improvement, and internal adjustments are expected to yield results in 2026. The company is focusing on product and channel adjustments to restart growth after streamlining operations [1][11][12]. - The revenue for 2025 is projected to be RMB 4.82 billion, a decline of 12.6% year-on-year, but is expected to recover in subsequent years with growth rates of 7.4% and 9.4% in 2026 and 2027 respectively [5][13]. Financial Summary - Revenue and net profit forecasts for Jonjee are as follows: - 2025: Revenue of RMB 4.82 billion, net profit of RMB 757 million - 2026: Revenue of RMB 5.18 billion, net profit of RMB 874 million - 2027: Revenue of RMB 5.67 billion, net profit of RMB 987 million [5][8][13]. - The gross profit margin is expected to improve to 39.1% by 2027, while the net profit margin is projected to reach 17.4% [4][8][10]. Product and Market Performance - In Q2 2025, Jonjee's main product, Meimeixian, generated revenue of RMB 1.016 billion, down 7.21% year-on-year, with soy sauce showing resilience despite overall pressure from weak catering demand [3][9]. - The company is actively developing low-salt and clean-label products to drive health and premium upgrades, while also focusing on regional flavors to enhance product offerings [11][12]. Market Position and Strategy - The company has increased its number of distributors by 127, particularly in the central and northern regions, indicating a strategic push to expand market presence [3][9]. - Jonjee is undergoing a channel transformation, with increased investments in catering and new retail e-commerce channels to seek market growth [11][12].