JZJ(605266) 国泰君安·2024-04-30 01:32Investment Rating - The report maintains an "Overweight" rating for the company with a target price of 60.19 CNY [2] - The current price is 47.69 CNY as of April 29, 2024 [2] Core Views - The company's short-term performance is under pressure due to high base effects and losses from newly opened stores, but the new equity incentive plan demonstrates confidence in long-term stable development [2] - The company achieved revenue of 90.81 billion CNY in 2023, a year-on-year increase of 20.84%, and net profit attributable to the parent company of 3.99 billion CNY, up 7.26% [2] - For Q1 2024, the company achieved revenue of 23.14 billion CNY, a year-on-year increase of 6.79%, but net profit attributable to the parent company decreased by 32.32% to 5.04 billion CNY, slightly below expectations [2] - The company has adjusted its EPS forecasts for 2024-2025 to 3.55/4.31 CNY (originally 3.73/4.44 CNY) and added a 2026 EPS forecast of 5.13 CNY [2] Financial Performance - The company's revenue for 2023 was 90.81 billion CNY, with a net profit of 3.99 billion CNY [2] - In Q1 2024, revenue was 23.14 billion CNY, but net profit decreased by 32.32% to 5.04 billion CNY [2] - The company's sales/management/financial expense ratios increased by 3.21/0.3/-0.03 percentage points respectively in Q1 2024 [2] - The company added 1,071 new stores in 2023, with 799 self-built and 272 acquired, leading to increased upfront costs and a decline in net profit margin [2] Expansion and Growth - The company has expanded rapidly, with the number of stores reaching 5,236 by Q1 2024, a year-on-year increase of 26% in 2023 and 25% in Q1 2024 [2] - The proportion of stores in Yunnan has decreased to 54%, indicating rapid development in other provinces [2] - The company's integration capabilities have been validated, with significant development in Hebei and Liaoning following the acquisition of Tangren [2] - The company has deepened cooperation with manufacturers, leading to an increase in the proportion of Chinese and Western medicine revenue to 77.29% in Q1 2024, with a 3.1 percentage point increase in gross margin [2] Equity Incentive Plan - The company has released a new equity incentive plan with a target of 15%/18%/18% net profit growth for 2024-2026 [2] - The plan reflects the company's confidence in achieving faster growth in revenue and store numbers [2] Financial Forecasts - The company's revenue is forecasted to be 10.884 billion CNY in 2024, 13.206 billion CNY in 2025, and 15.976 billion CNY in 2026 [2] - Net profit is expected to be 457 million CNY in 2024, 555 million CNY in 2025, and 661 million CNY in 2026 [2] - EPS is forecasted to be 3.55 CNY in 2024, 4.31 CNY in 2025, and 5.13 CNY in 2026 [2] Valuation Metrics - The company's P/E ratio is 16.42 for 2022, 14.83 for 2023, 13.44 for 2024, and 11.08 for 2025 [2] - The EV/EBITDA ratio is 6.86 for 2023, 6.77 for 2024, and 6.00 for 2025 [2] - The dividend yield is 3.1% for 2022, 2.7% for 2023, and 3.1% for 2024 [2] Industry and Business Model - The company is engaged in the retail of pharmaceuticals, health foods, personal care products, and household health products, with a focus on direct chain drug stores and e-commerce [4] - The company has a strong regional competitive advantage in Southwest China and is expanding nationwide [4] - The company's business model integrates physical retail with e-commerce, forming a diversified community health service ecosystem [4]