Jasan Group(SH:603558) Guotai Junan Securities·2024-03-17 16:00Investment Rating - The report maintains a "Buy" rating for the company, with a target price of 12.46 CNY, up from a previous forecast of 9.60 CNY [4][13]. Core Insights - The company's earnings performance has exceeded expectations, driven by a recovery in demand for cotton socks and improved capacity utilization, leading to a rapid growth forecast for 2024 [4][13]. - The report highlights that the company is actively expanding its production capacity in Vietnam, which is expected to enhance earnings elasticity [4][13]. - The company plans to distribute a cash dividend of 0.25 CNY per share, indicating a commitment to shareholder returns [4][13]. Summary by Sections Financial Performance - In 2023, the company's revenue and net profit were reported at 22.81 billion CNY and 2.70 billion CNY respectively, showing a year-on-year change of -3.1% and +3.3% [4][6]. - The fourth quarter of 2023 saw a revenue increase of 16.1%, marking a turning point in income growth [4][6]. - The company achieved a net profit margin improvement in its cotton sock business, with a net profit margin increase of 2 percentage points to 15% [4][6]. Revenue Growth - The company reported a significant revenue increase of 52% in its cotton sock segment for 2023, while the seamless product segment experienced a decline of 15% [4][6]. - The report anticipates continued growth in the cotton sock segment due to recovering orders from domestic brands [4][6]. Profitability Metrics - The report projects an increase in the company's EPS to 0.89 CNY for 2024, reflecting a positive outlook for profitability [4][6]. - The return on equity (ROE) is expected to rise to 12.6% in 2024, indicating improved profitability [4][6]. Market Position - The company is positioned as a leading manufacturer in the cotton sock and seamless product sectors, with a competitive edge due to its advanced production equipment sourced from Italy, Korea, and Japan [4][6]. - The average PE ratio for comparable companies in the industry is projected at 13, while the company is valued at a higher PE of 14 due to its growth potential [4][6].