R&T(SZ:002790) Southwest Securities·2024-04-29 11:30Investment Rating - The report maintains a "Buy" rating for the company, indicating a positive outlook for the next six months [2][23][29]. Core Insights - The company has shown strong revenue growth in its smart toilet and lid business, with a revenue increase of 25.9% year-on-year, contributing to 58% of total revenue [1][20]. - The overall gross margin improved to 29.5%, up 4.7 percentage points year-on-year, driven by product mix optimization and strong contributions from smart toilets [2][20]. - The company is expanding its online and offline sales channels, leveraging platforms like Douyin and Tmall, which is expected to sustain high growth rates for its proprietary brand [1][20]. Summary by Sections Financial Performance - In 2023, the company achieved a revenue of 2.184 billion yuan, a year-on-year increase of 11.5%, and a net profit of 220 million yuan, up 3.6% [20][23]. - For Q1 2024, revenue reached 520 million yuan, reflecting a 32.3% year-on-year growth, with net profit increasing by 47.1% [20][23]. Product Segmentation - The smart toilet and lid segment is projected to continue growing, with expected revenues of 1.266 billion yuan in 2024, a 25.9% increase [7][23]. - The water tank and accessories segment faced a decline of 13.7% in 2023, primarily due to inventory destocking by overseas clients [1][20]. Market Dynamics - Domestic sales grew significantly, with a 17.3% increase, while overseas sales declined by 3.2% due to challenges in the water parts OEM business [21][20]. - The company is expected to benefit from an expanding market for smart toilets as brand participation increases and price competition intensifies [1][20]. Profitability and Cost Management - The gross margin for the smart toilet segment is projected to be 30.1% in 2024, slightly decreasing due to intensified price competition but expected to recover in subsequent years [7][26]. - The company’s total expense ratio increased to 18.7%, mainly due to higher marketing expenses related to brand development [2][20]. Future Projections - Revenue is forecasted to grow to 2.682 billion yuan in 2024, with a year-on-year growth rate of 22.8% [7][23]. - The company anticipates a steady increase in earnings per share (EPS), projected at 0.63 yuan for 2024, with a corresponding price-to-earnings (PE) ratio of 18 [23][24].