Shede Spirits (SH:600702) KAIYUAN SECURITIES·2025-11-03 07:46Investment Rating - The investment rating for the company is maintained at "Outperform" [1] Core Insights - The company experienced a significant decline in revenue, with Q3 2025 revenue at 1 billion yuan, down 15.9% year-on-year, and a net profit of 30 million yuan, down 63.2% year-on-year. The revenue decline was greater than expected, attributed mainly to external environmental factors [6] - The company is actively managing channel inventory and has adjusted its resource distribution, linking to new channels and enhancing cost control, indicating potential for recovery as the external environment improves [6] - The forecast for net profit from 2025 to 2027 has been revised downwards, with expected net profits of 500 million yuan, 620 million yuan, and 830 million yuan, representing year-on-year growth rates of 43.3%, 24.1%, and 35.6% respectively [6] Financial Performance Summary - For the first three quarters of 2025, the company reported revenue of 3.7 billion yuan, a year-on-year decrease of 17.0%, and a net profit of 470 million yuan, down 29.4% year-on-year [6] - The Q3 revenue breakdown shows mid-to-high-end liquor revenue at 690 million yuan (down 23% year-on-year) and ordinary liquor revenue at 180 million yuan (up 18% year-on-year) [7] - The company’s gross margin for Q3 2025 was 62.1%, a decrease of 1.6 percentage points year-on-year, with a net profit margin of 2.9%, down 3.7 percentage points year-on-year [9] Cash Flow and Debt Management - As of the end of Q3 2025, the company had a contract liability balance of 110 million yuan, down 40 million yuan from the previous quarter, indicating significant cash flow pressure [8] - Sales cash receipts for Q3 were 920 million yuan, down 19.4% year-on-year, reflecting the challenges faced by distributors in collecting payments [8] Valuation Metrics - The current stock price corresponds to a P/E ratio of 41.7 for 2025, 33.6 for 2026, and 24.8 for 2027 [6] - The projected earnings per share (EPS) for 2025, 2026, and 2027 are 1.49 yuan, 1.85 yuan, and 2.51 yuan respectively [11]