Guangzhou Restaurant(SH:603043) Orient Securities·2024-05-28 13:32Investment Rating - The report maintains a "Buy" rating for the company with a target price of 18.40 CNY, based on a 16x price-to-earnings ratio for 2024 [3]. Core Views - The company demonstrated robust growth in 2023, achieving revenue of 4.901 billion CNY (+19.17%) and a net profit of 550 million CNY (+5.21%). The restaurant segment showed significant growth, with a revenue increase of 65.66% [1][2]. - In Q1 2024, the company continued its steady performance with revenue of 1.012 billion CNY (+10.04%) and a net profit of 71 million CNY (+2.22%). The restaurant revenue reached 384 million CNY (+13.33%) due to an increase in the number of outlets [1]. - The company is actively expanding its production capacity, with new facilities and projects aimed at enhancing long-term growth potential [1]. Financial Summary - The company reported a gross margin of 35.63% in 2023, which remained stable year-on-year. However, the gross margin for Q1 2024 decreased to 29.74% due to changes in product mix [1]. - The forecasted earnings per share for 2024-2026 are 1.15 CNY, 1.39 CNY, and 1.60 CNY respectively, reflecting a gradual increase in profitability [2]. - The company’s revenue is projected to grow from 4.901 billion CNY in 2023 to 7.386 billion CNY by 2026, with a compound annual growth rate of approximately 13.7% [2].