Investment Rating - The report maintains a "Buy" recommendation for Shenzhou International, indicating a positive outlook for the stock price in the next six months [3][7]. Core Views - The revenue decline in the second half of 2023 has narrowed, with a sequential improvement in profits. The company reported a total revenue of 24.97 billion HKD for 2023, down 10.1% year-on-year, but the second half revenue was 13.41 billion HKD, down only 5.5% year-on-year and up 16% quarter-on-quarter [5][6]. - Profitability improved in the second half of 2023 due to increased production capacity in overseas factories and a rise in core customer order volumes. The gross profit for the second half was 3.46 billion HKD, up 13.2% year-on-year, with a gross margin of 25.8% [6][7]. - The company has a strong competitive position as the largest vertically integrated knitwear manufacturer in China, with key clients including Nike and Adidas. The report suggests that the current valuation offers good value for investors [7]. Financial Summary - For the fiscal year 2023, the company reported a net profit attributable to shareholders of 4.56 billion HKD, a slight decrease of 0.1% year-on-year, with a net profit margin of 18.3% [5][6]. - The report projects net profits for 2024 and 2025 to be 5.35 billion HKD and 6.17 billion HKD, respectively, with an expected net profit of 7.10 billion HKD in 2026 [7][8]. - The company's earnings per share (EPS) for 2023 was 3.03 HKD, with projections of 3.56 HKD for 2024 and 4.11 HKD for 2025 [8].
下半年收入降幅收窄，利润环比逐季改善