QIANHE(SH:603027) Guotai Junan Securities·2024-05-05 02:32Investment Rating - The report maintains a "Buy" rating for Qianhe Flavor Industry Co., Ltd. (603027) with a target price of 27.57 CNY, unchanged from the previous forecast [4][15]. Core Insights - The company's performance in Q1 2024 met expectations, with operational momentum gradually being released as channel deficiencies are addressed and operational efficiency continues to improve [3]. - The company achieved a revenue of 3.207 billion CNY and a net profit of 530 million CNY in 2023, representing year-on-year increases of 32% and 54%, respectively [3][30]. - The company is expected to evolve into a platform-type condiment enterprise by continuously addressing shortcomings and expanding its product offerings [3][15]. Financial Summary - The projected EPS for 2024 is 0.64 CNY, up 25% year-on-year, with 2025 EPS revised to 0.76 CNY, an 18% increase, and 2026 EPS set at 0.91 CNY, a 20% increase [3][15]. - The company reported a net profit margin of 16.54% in 2023, an increase of 2.42 percentage points year-on-year, attributed to improved sales efficiency and channel optimization [13]. - The gross profit margin for 2023 was 37.15%, reflecting a year-on-year increase of 0.59 percentage points, with significant contributions from soy sauce and vinegar segments [13][34]. Product and Channel Development - The company has seen significant growth in its product lines, with soy sauce revenue increasing by 34.75% in 2023, driven by the health-conscious trend and the expansion of zero-additive products [34]. - The number of distributors increased significantly, with a net addition of 1,020 distributors in 2023, enhancing the company's national distribution network [3][34]. - In Q1 2024, the company continued to expand its product offerings, with revenue from new products like oyster sauce and cooking wine contributing to overall growth [34].