Hongqi Chain(002697) 海通证券·2024-04-04 16:00Investment Rating - The report maintains an "Outperform the Market" rating for the company [19]. Core Views - The company achieved a revenue of 10.133 billion yuan in 2023, a year-on-year increase of 1.12%, with a net profit attributable to shareholders of 561 million yuan, up 15.53% year-on-year [4][5]. - The company plans to accelerate store expansion in 2024, with a focus on both opening new stores and upgrading existing ones [6][8]. - The report estimates a reasonable market value range for the company between 7.6 billion and 9.8 billion yuan, corresponding to a reasonable value range of 5.58 to 7.24 yuan per share [9][26]. Financial Performance - In 2023, the company’s gross profit margin increased by 0.57 percentage points to 29.63%, with a significant increase in the fourth quarter [5]. - The company opened 144 new stores and renovated 279 stores in 2023, bringing the total number of stores to 3,639 by the end of the year [6]. - The company’s operating cash flow net amount was 1.242 billion yuan, a decrease of 15.53% year-on-year [4]. Revenue Breakdown - Revenue from the tobacco and alcohol segment increased by 9.56%, while food and daily necessities saw declines of 5.51% and 1.73%, respectively [21]. - In terms of regional performance, revenue from urban areas in Chengdu grew by 8.35%, while revenue from suburban and secondary city areas decreased by 11.82% and increased by 2.70%, respectively [21]. Cost and Efficiency - The report notes a 0.4 percentage point increase in the expense ratio for 2023, with sales expense ratio rising by 0.49 percentage points and financial expense ratio decreasing by 0.11 percentage points [22]. - The average salary per employee was 80,000 yuan, reflecting a year-on-year increase of 2.5%, with labor efficiency improving by 2% to 657,000 yuan per employee [22]. Future Projections - The company is projected to achieve a net profit of 617 million yuan in 2024, with a year-on-year growth of 10% [24]. - The report forecasts a steady increase in revenue, with expected figures of 10.713 billion yuan in 2024, 11.390 billion yuan in 2025, and 12.094 billion yuan in 2026 [23].