M&G(SH:603899) ZHONGTAI SECURITIES·2025-10-31 06:31Investment Rating - The report maintains a "Buy" rating for the company, indicating an expected relative performance increase of over 15% compared to the benchmark index within the next 6 to 12 months [4][10]. Core Views - The company has shown signs of recovery in its traditional core business, with a narrowing decline in revenue. The office direct sales segment (KeliPu) has exceeded expectations with a revenue growth of 17.3% in Q3 2025, driven by new contracts with major state-owned enterprises and government clients [5][6]. - The report highlights a positive outlook for the company's transformation efforts, which are expected to gradually release performance improvements. The company is shifting from functional products to a combination of "function + emotion" products, enhancing its IP strategy [5][6]. Summary by Sections Financial Performance - In Q3 2025, the company reported revenue of 6.52 billion yuan, a year-on-year increase of 7.5%, and a net profit attributable to shareholders of 390 million yuan, up 0.6% year-on-year. The net profit margin was 6.2%, down 0.4 percentage points [4][5]. - The traditional core business (including online sales) generated revenue of 2.54 billion yuan in Q3 2025, reflecting a year-on-year decline of 3.6%. In the first half of 2025, this segment's revenue was 3.90 billion yuan, down 7.2% year-on-year, indicating a narrowing decline [5][6]. Business Segments - KeliPu's revenue in Q3 2025 reached 3.56 billion yuan, marking a year-on-year increase of 17.3%. The first half of 2025 saw revenue of 6.13 billion yuan, a slight increase of 0.15% year-on-year, indicating a recovery in growth [6]. - The lifestyle store segment (including Jiumu miscellaneous store) reported Q3 2025 revenue of 410 million yuan, up 6.6% year-on-year, with a first-half revenue of 780 million yuan, reflecting a 7.0% increase year-on-year. The operational status of this segment remains stable [6]. Future Outlook - The company is expected to achieve net profits attributable to shareholders of 1.45 billion yuan, 1.66 billion yuan, and 1.93 billion yuan for the years 2025 to 2027, respectively. The earnings per share (EPS) are projected to be 1.58 yuan, 1.81 yuan, and 2.09 yuan for the same period [4][6].