Proya(SH:603605) SINOLINK SECURITIES·2024-04-19 05:30Investment Rating - The report maintains a "Buy" rating for the company [1][3] Core Insights - The company reported strong performance in 4Q23 and 1Q24, with revenue and net profit growth of 51% and 39% in 4Q23, and 35% and 46% in 1Q24, respectively, exceeding expectations [2] - The growth is attributed to the deepening of the big product strategy and the successful performance of sub-brands [2] - The company is expected to continue its growth trajectory with projected net profits of 14.77 billion, 17.95 billion, and 21.38 billion RMB for 2024-2026, reflecting year-on-year growth rates of 24%, 22%, and 19% [3] Performance Analysis - The company's net profit margin has shown a steady increase, with net profit margins of 13.41% and 13.88% for 2023 and 1Q24, respectively [2] - Gross margin remained stable at 69.93% in 2023 and is projected to be 70.11% in 2024 [2] - Online direct sales continue to grow significantly, accounting for 93.07% of total sales in 2023, with a year-on-year increase of 42.96% [2] Revenue Forecast - The company’s revenue is projected to reach 10.94 billion, 13.23 billion, and 15.68 billion RMB for 2024-2026, with growth rates of 22.9%, 20.88%, and 18.5% respectively [6][7] - The main brand is focusing on product upgrades and expanding its product lines, which is expected to drive sales growth [2] Brand Performance - The main brand, Proya, continues to grow rapidly despite a high base, while sub-brands like Caitang and OR are also performing well [2] - Revenue for Proya, Caitang, OR, and Yuefumi in 2023 was 7.2 billion, 1 billion, 200 million, and 300 million RMB, respectively, with year-on-year growth rates of 36%, 75%, 71%, and 62% [2] Market Position - The company is recognized as a leading local beauty group with strong growth potential and performance delivery capabilities [3]