Henglin(SH:603661) Guotai Junan Securities·2024-04-26 09:02Investment Rating - The report maintains a "Buy" rating for Henglin Co., Ltd. (603661) with a target price of 56.80 CNY, up from the previous forecast of 55.80 CNY, while the current price is 43.30 CNY [21][22]. Core Insights - The company has shown strong growth in its cross-border e-commerce segment, with a year-on-year revenue increase exceeding 200%, contributing approximately half of the revenue growth. The operational capabilities in e-commerce continue to strengthen, supported by an effective overseas warehouse model [1][2]. - The report highlights that the company's core business advantages are expanding, with a strategic refocus leading to improved profitability. The net profit for 2023 is projected at 443 million CNY, a year-on-year increase of 74.2% [1][2]. - The report anticipates continued revenue growth, with expectations for 2024-2026 earnings per share (EPS) of 3.93, 4.64, and 5.67 CNY respectively, reflecting a positive outlook based on industry valuation levels [1][2]. Summary by Sections Financial Performance - The total revenue for 2023 is projected at 8,195 million CNY, with a growth rate of 25.8%. The EBIT is expected to reach 444 million CNY, marking a 43.1% increase, while the net profit is forecasted to be 263 million CNY, a decrease of 26.6% compared to the previous year [2]. - For 2024, the total revenue is expected to rise to 9,752 million CNY, with a growth rate of 19%. The EBIT is projected at 800 million CNY, an 80.5% increase, and the net profit is anticipated to be 547 million CNY, reflecting a significant recovery [2]. Valuation Metrics - The report provides valuation ratios, with a projected PE ratio of 11.01 for 2024 and a PB ratio of 1.58. The EV/EBITDA is expected to be 6.90, indicating a favorable valuation compared to industry peers [2][10]. - The dividend yield is projected to increase from 1.7% in 2023 to 2.3% in 2024, reflecting the company's commitment to returning value to shareholders [2]. Market Position - Henglin Co., Ltd. is recognized as a leading developer and manufacturer of health-oriented seating products in China, with a strong focus on innovation in the office furniture sector. The company is noted for its competitive product offerings and robust export capabilities [21].