INZONE GROUP(SH:600858)2024-04-07 16:00Investment Rating - The report assigns an "Outperform" rating to the company with a target price of RMB 6.54 [9][20][27]. Core Insights - The company reported a revenue of RMB 5.54 billion in 2023, representing a year-on-year growth of 2.97%, with a notable increase of 12.38% in Q4 [11][18][35]. - The net profit attributable to shareholders turned positive at RMB 216 million, a significant improvement from a loss of RMB 11 million in the previous year [19][35]. - The company has focused on operational optimization and efficiency improvements, including a dynamic adjustment of product offerings and a significant increase in online sales by 62.53% year-on-year [37]. Financial Performance Summary - In 2023, the company achieved a gross profit margin (GPM) of 41.48%, an increase of 1.03 percentage points from the previous year [36][28]. - The company opened 7 new stores and closed 4, resulting in a total of 119 stores across Shandong, Hebei, and Heilongjiang provinces [12][18]. - The projected revenue for 2024-2026 is RMB 5.67 billion, RMB 5.78 billion, and RMB 5.89 billion, respectively, with net profits expected to be RMB 76 million, RMB 89 million, and RMB 98 million [20][29]. Operational Highlights - The company has seen a decline in department store sales by 0.99%, while supermarkets and shopping centers experienced growth of 4% and 10.19%, respectively [27][18]. - Real estate revenue fell by 88.94%, primarily due to decreased residential sales from the Qingdao Qianhao project [18][27]. - The company has expanded its market presence into Heilongjiang province in 2023, indicating a strategic growth initiative [12][18].