GREE(SZ:000651) Tai Ping Yang·2024-05-06 02:30Investment Rating - The report maintains a "Buy" rating for Gree Electric Appliances, with a target price based on the last closing price of 42.12 [1][6]. Core Insights - Gree Electric Appliances reported a revenue of 203.98 billion yuan in 2023, a year-on-year increase of 7.93%, and a net profit of 29.02 billion yuan, up 18.41% year-on-year. For Q1 2024, the company achieved a revenue of 36.36 billion yuan, a 2.56% increase year-on-year, and a net profit of 4.68 billion yuan, reflecting a 13.77% year-on-year growth [4][6]. - The company plans to invest 3 billion yuan in a "trade-in" program to stimulate consumer purchasing and drive revenue growth [6][8]. - Gree's product matrix has been enhanced with new launches across various segments, including air conditioning and smart equipment, which have contributed to revenue growth [5][6]. Financial Performance - In Q4 2023, Gree's revenue was 48.97 billion yuan, a year-on-year increase of 18.01%, with a net profit of 8.93 billion yuan, up 43.90% year-on-year. The growth was attributed to a low base in Q4 2022 and expansion in the air conditioning sector [4][5]. - The gross margin for Q4 2023 and Q1 2024 was 34.76% and 29.45%, respectively, showing an increase of 6.96 and 2.03 percentage points year-on-year [5][6]. - The company expects net profits for 2024 to reach 32.30 billion yuan, with a projected EPS of 5.73 yuan, corresponding to a PE ratio of 7.34 [7][8]. Market Strategy - Gree is focusing on digital store construction and enhancing its online presence through platforms like JD and Tmall, which has led to increased sales performance [6][8]. - The company has expanded its international sales, reaching over 190 countries, and is enhancing its presence on social media platforms to boost brand visibility [6][8]. Future Outlook - The report anticipates that Gree's net profit will continue to grow, with projections of 35.68 billion yuan in 2025 and 38.69 billion yuan in 2026, indicating a stable growth trajectory [7][8]. - The investment in Gree Titanium is expected to accelerate the development of its new energy business, contributing positively to future earnings [6][8].