Bestore(SH:603719) Guotai Junan Securities·2024-05-07 03:32Investment Rating - The report maintains a "Buy" rating for the company, with a target price set at 18.80 CNY, down from a previous forecast of 27.70 CNY [7][9]. Core Views - The company is experiencing short-term pressure on revenue and profitability, prompting adjustments in store expansion speed and optimization of product pricing structures and channel models, with expectations for stabilization and recovery [7][9]. - The company reported a revenue of 8.046 billion CNY in 2023, a year-on-year decrease of 14.76%, with a net profit attributable to shareholders of 1.80 billion CNY, down 46.26% year-on-year [7][9]. - The competitive landscape is intensifying, and pricing adjustments are impacting short-term profitability, with expectations for gradual recovery as the company enhances supply chain efficiency and consumer communication [7][9]. Financial Summary - The company’s revenue is projected to increase to 8.589 billion CNY in 2024, with a further rise to 9.707 billion CNY in 2025 [13]. - The net profit is expected to recover to 197 million CNY in 2024 and 247 million CNY in 2025, reflecting a growth trajectory [13]. - Key financial metrics include a projected net profit margin of 2.2% in 2024 and 2.5% in 2025, with a return on equity (ROE) of 7.7% in 2024 and 9.2% in 2025 [13][9]. Market Performance - The company’s stock has shown a significant decline, with a 52-week price range of 13.46 to 33.31 CNY, indicating volatility in market performance [7][9]. - The report highlights a need for the company to adapt to changing consumer demands and competitive pressures, with a focus on enhancing product quality and value perception [7][9].