Investment Rating - The investment rating for China Feihe (6186.HK) is "Buy" with a target price of 4.9 HKD, indicating a potential upside of 33% from the current price of 3.68 HKD [3][8]. Core Insights - The worst period for the industry is expected to be over, with a projected recovery in birth rates in 2024, which may positively impact the company's performance [1]. - In 2023, the company's revenue was 19.5 billion RMB, a decline of 8.3% year-on-year, primarily due to intensified competition and a decrease in birth rates [1][14]. - The net profit for 2023 was 3.29 billion RMB, down 33% year-on-year, with a net profit margin of 16.8% [1][14]. - The company is focusing on digital sales strategies and inventory management to navigate the challenging market conditions [1]. Financial Performance Summary - Revenue for 2023: 19.5 billion RMB, down 8.3% YoY [1][14]. - Net profit for 2023: 3.29 billion RMB, down 33% YoY [1][14]. - Gross margin for 2023: 64.8%, a decrease of 0.7 percentage points YoY [1][14]. - Sales expense ratio: 34.3%, an increase of 3.6 percentage points YoY [1][14]. - Management expense ratio: 9%, an increase of 1.8 percentage points YoY [1][14]. - Cash and cash equivalents at the end of 2023: 19.6 billion RMB, with a debt ratio of 27% [1][14]. Earnings Forecast - Projected net profit for 2024: 3.55 billion RMB, with an EPS of 0.43 HKD [1][14]. - Projected net profit for 2025: 3.71 billion RMB, with an EPS of 0.45 HKD [1][14]. - Projected net profit for 2026: 3.89 billion RMB, with an EPS of 0.47 HKD [1][14]. Valuation Analysis - The average P/E ratio for comparable companies in the dairy sector is estimated at 10x, leading to a target price of 4.9 HKD based on a combination of comparable company and DCF valuation methods [8][10].
行业最坏时期即将过去