Eastroc Beverage(SH:605499) CHINA DRAGON SECURITIES·2024-04-21 02:00Investment Rating - Buy rating (first coverage) [1][2] Core Views - The company's second growth curve, including electrolyte drinks, tea drinks, pre-mixed alcohol, and ready-to-drink coffee, has shown strong performance [1] - The company's flagship product, Dongpeng Special Drink, accounts for 91.87% of revenue, with a growth rate of 26.48% [1] - Other beverage products, including Dongpeng Water and Dongpeng Coffee, account for 5.11% of revenue, with a growth rate of 186.65% [1] - The company's main sales regions are Guangdong, East China, Central China, North China, Guangxi, and Southwest China, accounting for 86.98% of revenue [1] - The company's gross profit margin increased by 0.74 percentage points to 43.07% in 2023, mainly due to lower raw material costs [1] - The company's net profit margin increased by 1.17 percentage points to 18.11% in 2023, reflecting improved profitability [1] - The company's market share in the energy drink market increased from 36.70% in 2022 to 43.02% in 2023, maintaining its leading position [2] Financial Performance - Revenue in 2023 was RMB 11.263 billion, a year-on-year increase of 32.42% [1] - Net profit attributable to shareholders in 2023 was RMB 2.040 billion, a year-on-year increase of 41.60% [1] - Adjusted net profit attributable to shareholders in 2023 was RMB 1.870 billion, a year-on-year increase of 38.29% [1] - Revenue in Guangdong region was RMB 3.761 billion, accounting for 33.44% of total revenue, with a year-on-year growth of 12.14% [1] - Revenue growth in North China, East China, and Southwest China regions was 64.83%, 48.41%, and 64.71% respectively [1] - Sales through distribution channels accounted for 86.74% of revenue, with a growth rate of 28.72% [1] Future Projections - Revenue is expected to reach RMB 14.487 billion in 2024, RMB 18.010 billion in 2025, and RMB 22.248 billion in 2026, with year-on-year growth rates of 28.6%, 24.3%, and 23.5% respectively [2] - Net profit attributable to shareholders is expected to reach RMB 2.656 billion in 2024, RMB 3.291 billion in 2025, and RMB 4.078 billion in 2026, with year-on-year growth rates of 30.2%, 23.9%, and 23.9% respectively [2] - The company's PE ratio is expected to be 29.1X in 2024, 23.5X in 2025, and 19.0X in 2026 [2] Market Position - Dongpeng Special Drink ranked first in sales volume in the Chinese energy drink market in 2023, with a market share of 43.02% [2] - Dongpeng Special Drink ranked second in sales value in the Chinese energy drink market in 2023, with a market share of 30.94% [2]