YILI(SH:600887) Guoyuan Securities·2024-05-05 02:00Investment Rating - The report maintains a "Buy" rating for Yili Co., Ltd. [2][6] Core Views - The company's 2023 annual report and 2024 Q1 report show a total revenue of 1261.79 billion yuan, a year-on-year increase of 2.44%, and a net profit attributable to shareholders of 104.29 billion yuan, up 10.58% year-on-year. The company also announced a share buyback plan of 1-2 billion yuan, which is expected to boost investor confidence [2][3]. Summary by Sections Financial Performance - In 2023, Yili's total revenue reached 1261.79 billion yuan, with a net profit of 104.29 billion yuan, reflecting a year-on-year growth of 10.58%. The Q4 2023 revenue was 287.75 billion yuan, down 1.82% year-on-year, while Q1 2024 revenue was 325.77 billion yuan, down 2.58% year-on-year. The company plans to distribute a cash dividend of 1.20 yuan per share, with a payout ratio of 73.25% [2]. Product Sales - Liquid milk sales in 2023 increased by 2.10%, indicating stable growth. The revenue from liquid milk, milk powder, dairy products, and ice cream for 2023 was 855.40 billion yuan, 275.98 billion yuan, 106.88 billion yuan, and 6.34 billion yuan, respectively. The sales volume for liquid milk grew by 2.10%, while the average price decreased by 1.35% due to falling milk prices [2]. Margin Improvement - The gross margin for 2023 was 32.58%, an increase of 0.32 percentage points year-on-year, primarily benefiting from lower milk prices and improved margins in liquid milk. The net profit margin was 8.26%, up 0.61 percentage points year-on-year. In Q1 2024, the gross margin further improved to 35.79%, with a net profit margin of 18.18% [2]. Future Projections - The report forecasts net profits for 2024, 2025, and 2026 to be 130.64 billion yuan, 128.79 billion yuan, and 137.64 billion yuan, respectively, representing year-on-year growth rates of 25.27%, -1.42%, and 6.87%. The corresponding price-to-earnings ratios are projected to be 14, 14, and 13 times [2].