Grainger(US:GWW) Soochow Securities international·2024-04-10 16:00Investment Rating - The report assigns an "Accumulate" rating to the company, indicating a positive outlook for investment [44]. Core Insights - The company is a leading global digital MRO distributor, expected to leverage its first-mover advantage and scale effects to continuously capture market share [44][39]. - The MRO industry has a vast market potential, with the company positioned to address traditional procurement pain points through its digital procurement model [44][39]. - The competitive landscape of the MRO market is fragmented, allowing the company to benefit from its scale and operational efficiencies [44][39]. Summary by Sections 1. Digital MRO Procurement - Digital MRO procurement effectively helps clients reduce costs and improve efficiency, with the potential to save approximately 15-20% on procurement costs and 70% of procurement time [44][39]. - The global MRO market is projected to grow at a CAGR of approximately 2.45% from 2023 to 2032, indicating significant market opportunities [44][39]. 2. Company Overview - The company is recognized as a global leader in full-category digital MRO distribution, with a strong balance sheet and robust growth in performance and profitability [44][39]. - The company has over 30 million MRO products and serves more than 4.5 million customers globally, showcasing its extensive reach and product variety [21][39]. 3. Competitive Landscape - The MRO market is highly fragmented, with the company holding only about 3% of the global market share, indicating room for growth [44][39]. - The company has a strong competitive edge in product variety, quality, pricing, and logistics, which enhances customer retention and attracts new clients [21][39]. 4. Financial Forecast and Valuation - The company is expected to achieve revenue growth of 4.4% in 2024, 6.1% in 2025, and 7.0% in 2026, reaching revenues of $17,194 million, $18,239 million, and $19,539 million respectively [33][44]. - The projected net profit for the same years is $1,870 million, $2,050 million, and $2,260 million, with corresponding P/E ratios of 26.7, 24.3, and 22.1 [33][44].