Guotai Junan Securities·2024-04-23 10:03Investment Rating - The report maintains a "Buy" rating for the company, indicating a positive outlook for its stock performance [3][10]. Core Insights - The company's Q1 revenue met expectations, and there is an anticipated gradual improvement in revenue growth moving forward. The report forecasts a steady development for the brand, leveraging its position as a leader in the domestic sportswear market. The expected net profits for 2024-2026 are projected to be 3.38 billion, 3.75 billion, and 4.14 billion RMB respectively, with corresponding PE ratios of 12, 11, and 10 times [2][6]. Summary by Sections Financial Performance - Q1 revenue growth was in line with expectations, with a healthy inventory turnover ratio of 4-4.5 months. The online sales growth was between 20-30%, outperforming expectations, while offline sales showed a decline in low single digits [2][6]. - The company expects a gradual increase in revenue throughout 2024, driven by new product launches and marketing activities, with a forecasted revenue growth of mid-single digits year-on-year and a low double-digit net profit margin [2][6]. Market Position and Strategy - The company is positioned as a leader in the "Guochao" (national trend) sportswear market, with strong growth potential in women's, outdoor, and youth segments. The report highlights the successful performance of the outlet channels and the optimization of store structures, which contributed to better revenue growth compared to same-store sales [2][6]. - The anticipated product launches, including the Wade 11 in May and new products targeting emerging markets, are expected to enhance sales performance in the second half of the year [2][6].