Fuling Zhacai(SZ:002507) Huachuang Securities·2024-03-31 16:00Investment Rating - The report maintains a "Recommended" rating for the company, with a target price of 15.8 yuan, compared to the current price of 13.50 yuan [1][8]. Core Insights - The company reported a total revenue of 2.45 billion yuan in 2023, a year-on-year decrease of 3.9%, and a net profit attributable to shareholders of 827 million yuan, down 8.0% year-on-year. The fourth quarter saw a slight revenue decline of 0.8% and a net profit drop of 17.3% [8]. - The company anticipates a revenue growth target of 12.0% and a cost growth target of 9.96% for 2024. A cash dividend of 3.46 billion yuan is planned, yielding a dividend rate of 2.2% [8]. - The report highlights ongoing pressure in the pickled vegetable market, with a notable decline in revenue from radishes and pickles, while new products like pickled vegetable sauce have shown significant growth [8]. Financial Summary - Revenue and Profit Forecasts: - Total revenue is projected to grow from 2.45 billion yuan in 2023 to 2.67 billion yuan in 2024, with a year-on-year growth rate of 8.9% [2]. - Net profit is expected to increase from 827 million yuan in 2023 to 910 million yuan in 2024, reflecting a growth rate of 10.0% [2]. - Earnings per share (EPS) is forecasted to rise from 0.72 yuan in 2023 to 0.79 yuan in 2024 [2]. - Profitability Metrics: - The gross profit margin for 2023 was 50.7%, down 2.4 percentage points year-on-year, while the net profit margin was 33.7%, a decrease of 1.5 percentage points [8]. - The report indicates a slight recovery in gross margin for Q4 2023, reaching 50.6% [8]. - Market Performance: - The company has faced challenges in maintaining revenue growth due to high competition and changing consumer preferences, particularly in the pickled vegetable segment [8]. - Management Changes: - A new management team has been appointed, focusing on stabilizing core products and expanding into new categories, which may positively impact future performance [8]. - Dividend Policy: - The company plans to distribute at least 80% of its profits as cash dividends, reflecting a commitment to shareholder returns [8].