Core Viewpoint - The article highlights the significant improvements in the line loss rate at the Yujing Power Supply Station in Shanxi Province, transitioning from over 10% to 0.95%, showcasing the effectiveness of digital monitoring and management strategies implemented by the company [1][4]. Group 1: Operational Challenges - The Yujing Power Supply Station oversees 105 distribution areas across 409 square kilometers, with over 90% of its transmission lines located in rugged terrain, making maintenance challenging [2]. - In 2023, the station reported over 1,000 instances of abnormal line loss due to equipment aging and electricity theft, resulting in consistently low performance evaluations [2]. Group 2: Strategic Initiatives - The "Youth Training" initiative launched in early 2024 introduced three key strategies: improving cafeteria offerings to foster team spirit, conducting hands-on training for older employees on digital tools, and creating a 3D map of high-loss areas for targeted interventions [3]. - The implementation of these strategies led to the station being recognized as one of the top 100 line loss management stations in the country by September 2024, marking a turnaround from its previous poor performance [4]. Group 3: Performance Outcomes - By April 2025, the Yujing Power Supply Station maintained a line loss compliance rate of over 99% for eight consecutive months, with its economic operation rate increasing from 50% to 93% [4]. - The company’s approach has been described as a significant shift from extensive management to precise service, with the potential to serve as a model for the industry [4].

Investment Rating - The report maintains a "Recommended" rating for the company, with a target price of 19.6 yuan [2][8]. Core Views - The company experienced continued pressure in 2024, with total revenue of 6.257 billion yuan, a year-on-year decrease of 13.84%, and a net profit attributable to shareholders of 227 million yuan, down 34.04% year-on-year. The fourth quarter of 2024 saw a revenue drop of 23.8% year-on-year, resulting in a net loss of 211 million yuan [2][4]. - In the first quarter of 2025, total revenue was 1.501 billion yuan, a decrease of 11.47% year-on-year, with a net profit of 120 million yuan, down 27.29% year-on-year [2][4]. - The company is actively exploring changes to improve its situation, focusing on brand upgrades, digital transformation, and lean operations. It aims to stabilize store numbers and improve same-store sales [2][8]. Financial Summary - **2024 Financial Performance**: - Total revenue: 6,257 million yuan - Year-on-year growth rate: -13.8% - Net profit: 227 million yuan - Year-on-year growth rate: -34.0% - Gross margin: 30.5% [4][9] - **2025 Financial Projections**: - Total revenue expected: 5,877 million yuan - Year-on-year growth rate: -6.1% - Net profit expected: 501 million yuan - Year-on-year growth rate: 120.4% - EPS forecast: 0.83 yuan [4][9] - **Valuation Ratios**: - PE ratio for 2025: 20 times - PE ratio for 2026: 16 times - PE ratio for 2027: 14 times [4][9] Market Performance - The company's stock price has shown significant volatility, with a current price of 16.12 yuan, reflecting a challenging market environment [4][8]. Operational Insights - The company faced challenges with store closures, estimating around 2,000 net closures in 2024, impacting revenue and same-store sales negatively [2][8]. - The company is focusing on improving operational efficiency and exploring digital applications in collaboration with Tencent to enhance its business model [2][8].