Joyoung(SZ:002242) Huachuang Securities·2024-04-07 16:00Investment Rating - The report maintains a "Recommended" rating for Jiuyang Co., Ltd. with a target price of 14 CNY, while the current price is 10.51 CNY [2][10][21]. Core Views - Jiuyang's revenue for 2023 was 9.61 billion CNY, a decrease of 5.5% year-on-year, with a net profit attributable to shareholders of 389 million CNY, down 26.5% year-on-year. The fourth quarter of 2023 saw revenue of 2.83 billion CNY, a decline of 12.9% year-on-year, but a slight increase in net profit of 0.26 billion CNY, up 0.9% year-on-year [2][10][21]. - The domestic demand for small household appliances is weak, leading to a decline in Jiuyang's revenue. However, overseas sales grew by 69%, indicating a shift in market dynamics. The company is focusing on product innovation in niche categories to adapt to the K-shaped recovery in domestic demand [2][10][21]. - The gross margin in Q4 2023 decreased to 27%, down 2.8 percentage points year-on-year, primarily due to an increase in low-margin export sales, which accounted for 23% of total revenue, up 10 percentage points from the previous year. The report anticipates a gradual recovery in profitability as domestic demand improves [2][10][21]. Financial Summary - For 2023, Jiuyang's main revenue was 9.61 billion CNY, with a year-on-year growth rate of -5.5%. The net profit attributable to shareholders was 389 million CNY, with a year-on-year growth rate of -26.5%. The earnings per share (EPS) for 2023 was 0.51 CNY [2][8][10]. - The financial forecasts for 2024 to 2026 predict revenues of 10.18 billion CNY, 11.01 billion CNY, and 11.55 billion CNY, respectively, with corresponding net profits of 458 million CNY, 519 million CNY, and 561 million CNY [2][8][10]. - The report projects a price-to-earnings (P/E) ratio of 18 for 2024, 16 for 2025, and 14 for 2026, indicating a potential for valuation improvement as the market recovers [2][8][10].