Investment Rating - The report maintains an "Overweight" rating for the company [5][8] Core Views - The company's 2023 performance met expectations, with significant growth in high-end products and improved profitability due to reduced raw material costs and narrowed exchange losses [3] - The company's revenue in 2023 was RMB 23.768 billion, up 5.1% YoY, with net profit attributable to shareholders reaching RMB 2.801 billion, up 45.5% YoY [3] - The report is optimistic about the company's future profitability improvement through cost control and product upgrades [3] Financial Performance - In H2 2023, the company's revenue was RMB 11.563 billion, up 1.3% YoY, with net profit attributable to shareholders reaching RMB 1.575 billion, up 142.6% YoY [3] - The company's gross profit margin for tissue products in H2 2023 was 26.1%, up 7.6 percentage points YoY and 8.4 percentage points QoQ [3] - The gross profit margin for sanitary napkins in H2 2023 was 66%, down 2.4 percentage points YoY but up 4.2 percentage points QoQ [3] - The gross profit margin for diapers in H2 2023 was 40%, up 1.2 percentage points YoY and 4 percentage points QoQ [3] Business Segments - Tissue products: H2 2023 revenue was RMB 6.578 billion, up 2.7% YoY, with high-end products like the Cloud Touch series growing 26.6% YoY [3] - Sanitary napkins: H2 2023 revenue was RMB 2.959 billion, down 2.3% YoY, but high-end products like panty-style sanitary napkins grew 73.4% YoY [3] - Diapers: H2 2023 revenue was RMB 589 million, up 3.5% YoY, with high-end diaper Q·MO growing approximately 21.8% YoY [3] Future Outlook - The report forecasts net profit attributable to shareholders for 2024-2026 to be RMB 2.923 billion, RMB 3.012 billion, and RMB 3.203 billion, respectively [3] - The company's e-commerce and new retail channels generated RMB 3.66 billion in revenue in H2 2023, up 7.6% YoY [3] - The company is expected to maintain stable pricing strategies and more precise cost control in 2024, with continued product upgrades driving profitability [3] Valuation - The target price is adjusted to HKD 31.08, based on a 12x PE ratio for 2025, in line with industry peers [8] - The company's current PE ratio is 11.07x for 2023, expected to decrease to 8.68x by 2026 [4]
2023年年报点评：成本压力缓解提振盈利，产品结构有望持续改善