Orient Securities·2024-03-26 16:00Investment Rating - The investment rating for the company is "Buy" (maintained) [1][6] Core Views - The company reported a revenue of 38.93 billion yuan for 2023, representing a year-over-year increase of 10.4%, and a net profit attributable to shareholders of 5.15 billion yuan, up 18.6% year-over-year. The performance for the second half of 2023 showed a revenue of 15.06 billion yuan, a year-over-year increase of 5.7%, but a net profit decline of 7.0% year-over-year [1] - The beer business saw a revenue of 36.87 billion yuan, with a volume of 11.15 million tons, and an average price of 3,306 yuan per ton, reflecting a 4.5% increase in revenue year-over-year. Premium and above beer sales grew by 18.9% to 2.5 million tons, with Heineken sales increasing nearly 60% to 600,000 tons [1] - The gross margin improved to 40.2%, an increase of 1.7 percentage points year-over-year, primarily due to price increases. The sales expense ratio was 20.7%, up 1.6 percentage points year-over-year, while the management expense ratio decreased by 0.8 percentage points to 8.6% [1] - The white liquor segment experienced a revenue decline, with a total income of 2.07 billion yuan and an EBIT of 130 million yuan. The company is implementing a strategy to stabilize prices and reduce inventory, with a 30% decrease in distributor inventory by the end of 2023 [1] Financial Summary - The company forecasts earnings per share of 1.59 yuan, 1.88 yuan, and 2.18 yuan for 2023, 2024, and 2025 respectively, with a target price of 40.81 HKD based on a 20x P/E ratio for 2024 [2][6] - The projected revenue for 2024 and 2025 is 41.87 billion yuan and 44.3 billion yuan, respectively, with year-over-year growth rates of 7.5% and 5.8% [3][10] - The gross margin is expected to increase to 44.9% in 2024 and 46.4% in 2025, reflecting ongoing improvements in pricing and cost management [3][10]