Jason Furniture (Hangzhou) (SH:603816) Southwest Securities·2024-05-06 01:00Investment Rating - The report maintains a "Buy" rating for the company with a current price of 33.39 CNY and a target price not specified for the next 6 months [1]. Core Views - The company has demonstrated steady revenue growth, with 2023 revenue reaching 19.21 billion CNY, a year-on-year increase of 6.7%. The net profit attributable to shareholders was 2.01 billion CNY, up 10.7% year-on-year [2][3]. - The company is focusing on improving operational efficiency, which has positively impacted profitability, with a net profit margin of 10.4% in 2023, an increase of 0.4 percentage points year-on-year [2]. - The company is expanding its domestic and international market presence, with domestic sales increasing by 37.6% to 10.94 billion CNY in 2023, while international sales grew by 6.8% to 7.52 billion CNY [3]. Summary by Sections Financial Performance - In 2023, the company achieved a revenue of 19.21 billion CNY, with a net profit of 2.01 billion CNY and a non-recurring net profit of 1.78 billion CNY, reflecting year-on-year growth rates of 6.7%, 10.7%, and 15.3% respectively [2]. - The gross margin for 2023 was 32.8%, an improvement of 2 percentage points year-on-year, with specific product margins showing varied performance [2][3]. - The operating cash flow for 2023 was 2.44 billion CNY, indicating stable cash flow management [2]. Product Performance - Sofa revenue reached 9.35 billion CNY in 2023, accounting for 48.7% of total revenue, while bed products saw a 15.4% increase in revenue to 4.10 billion CNY [3]. - High-potential categories such as functional sofas, bed products, and customized products showed strong growth despite market pressures [3]. Market Strategy - The company is optimizing its traditional channel structure and enhancing supply chain efficiency, with a net increase of 213 distribution stores in 2023 [3]. - The company has made significant strides in its international expansion, establishing flagship stores in India and improving profitability in its Vietnam operations [3]. Earnings Forecast - The company is projected to achieve earnings per share (EPS) of 2.79 CNY, 3.15 CNY, and 3.50 CNY for the years 2024 to 2026, with corresponding price-to-earnings (PE) ratios of 12, 11, and 10 [7][10].