YILI(600887) 西南证券·2024-05-06 07:10Investment Rating - The report maintains a "Buy" rating for the company [1][3]. Core Insights - The company reported a total revenue of 126.2 billion yuan in 2023, a year-on-year increase of 2.4%, and a net profit attributable to shareholders of 10.43 billion yuan, up 10.6% year-on-year. For Q1 2024, the revenue was 32.6 billion yuan, a decrease of 2.6%, while the net profit was 5.92 billion yuan, a significant increase of 63.8% [2]. - The company plans to distribute a cash dividend of 12.00 yuan per 10 shares (including tax) to all shareholders [2]. - The company is focusing on improving profitability through cost stabilization and product structure enhancement, alongside a share buyback plan of 1-2 billion yuan to boost investor returns [2]. Summary by Sections Financial Performance - In 2023, the liquid milk, milk powder, and cold drink segments generated revenues of 85.5 billion yuan (+0.7%), 27.6 billion yuan (+5.1%), and 10.7 billion yuan (+11.7%), respectively. In Q1 2024, these segments reported revenues of 20.3 billion yuan (-6.8%), 7.4 billion yuan (-0.2%), and 4.3 billion yuan (+14.2%) [2]. - The gross margins for 2023 and Q1 2024 were 32.6% (+0.3pp) and 35.8% (+2pp), respectively, primarily due to declining raw milk prices [2]. - The net profit margins for 2023 and Q1 2024 were 8.2% (+0.6pp) and 18.3% (+7.5pp), respectively, with the latter benefiting from increased investment income from subsidiary equity transfers [2]. Profitability Forecast - The company expects net profits for 2024-2026 to be 13.0 billion yuan, 13.3 billion yuan, and 13.9 billion yuan, with corresponding EPS of 2.04 yuan, 2.07 yuan, and 2.18 yuan, leading to dynamic PE ratios of 14x, 14x, and 13x [3][4]. Market Position and Strategy - The company holds the leading market share in liquid milk, with a retail market share of 16.2% in infant formula, up 1.6 percentage points. It is also focusing on functional dairy products for the elderly [2]. - The cold drink segment continues to outperform the industry, maintaining its market leadership [2]. - The company is leveraging strategic partnerships and investments in upstream dairy resources to enhance its supply chain efficiency and product quality [2].