Investment Rating - The investment rating for the company is "Buy" and is maintained [9]. Core Views - In 2024, the company has experienced a significant acceleration in its core business growth, supported by a decline in raw material costs, leading to notable profit improvements. The company is expected to continue its steady and positive growth into 2025, with a slight increase in profitability due to ongoing cost improvements. The implementation of an employee stock ownership plan is expected to enhance personnel motivation and improve the execution of the company's long-term strategy. Additionally, the dividend payout ratio for 2024 has increased to 75.2% from 65% in 2023, enhancing shareholder returns [2][7]. Financial Performance Summary - For the year 2024, the company achieved total revenue of 26.901 billion yuan, representing a 9.53% increase, with core business revenue of 25.128 billion yuan, up 10.14%. The net profit attributable to shareholders was 6.344 billion yuan, reflecting a 12.75% increase, while the net profit excluding non-recurring items was 6.069 billion yuan, up 12.51%. In Q4 2024, total revenue reached 6.502 billion yuan, a 10.03% increase, with core business revenue of 6.162 billion yuan, up 12.85%. The net profit attributable to shareholders for Q4 was 1.529 billion yuan, a 17.82% increase, and the net profit excluding non-recurring items was 1.455 billion yuan, up 17.07% [4][5]. Business Growth and Structure Optimization - The company's core business revenue for the year totaled 25.128 billion yuan, with a growth rate of 10.14%, and Q4 growth at 12.85%. The product breakdown shows soy sauce revenue at 13.758 billion yuan (+8.87%), seasoning sauce at 2.669 billion yuan (+9.97%), oyster sauce at 4.615 billion yuan (+8.56%), and other products at 4.086 billion yuan (+16.75%). Online sales have seen significant growth, with total online revenue of 1.243 billion yuan, up 39.78%, and Q4 growth at 59.25%. The number of distributors increased to 6,707, up by 116 from the previous year, indicating a stabilization and recovery in distribution channels [5][6]. Profitability Improvement - The company's net profit margin improved by 0.67 percentage points to 23.58%, with a gross margin increase of 2.26 percentage points to 37%. The expense ratio rose by 1.49 percentage points to 9.48%. In Q4, the net profit margin increased by 1.56 percentage points to 23.52%, with a gross margin of 37.66%, reflecting a significant improvement driven by a decrease in direct material costs for soy sauce, oyster sauce, and sauces, which fell by 6.8%, 7.6%, and 6.5%, respectively [6][7]. Future Earnings Projections - The company is projected to have earnings per share (EPS) of 1.28 yuan in 2025 and 1.39 yuan in 2026, with corresponding price-to-earnings (PE) ratios of 33 and 30 times, respectively [7].

Core Viewpoint - The company experienced a decline in revenue for 2024, with a total operating income of 32.14 billion yuan, down 5.3% year-on-year, while net profit attributable to shareholders increased slightly by 1.8% to 4.34 billion yuan [1] Financial Performance - In 2024, the company's gross margin improved to 40.23%, an increase of 1.57 percentage points year-on-year, primarily due to a decrease in raw material costs [2] - The net profit margin for 2024 was 13.98%, up 1.16 percentage points year-on-year, despite a decline in revenue [2] - The company reported a significant increase in online product sales, with a year-on-year growth of 21% in 2024, marking 12 consecutive years of growth in this channel [1] Product and Sales Dynamics - The company's beer sales volume decreased by 5.9% year-on-year in 2024, while the average price per ton increased by 0.6% [1] - The main brand, Tsingtao Beer, sold 4.34 million kiloliters in 2024, down 4.8% year-on-year, while other brands saw a 7.2% decline in sales volume [1] - The company is focusing on upgrading its product structure, with mid-to-high-end products accounting for 3.15 million kiloliters sold in 2024, a decrease of 2.7% year-on-year [1] Management Changes - The company underwent a management transition with the retirement of Chairman Huang Kexing and the election of President Jiang Zongxiang as the new Chairman, bringing extensive experience in governance and strategic management [3] - The new management is expected to drive growth in 2025, supported by a low base and recovery in the dining channel [3] Profit Forecast and Valuation - The company maintains profit forecasts for 2025 and 2026 at 4.846 billion yuan and 5.171 billion yuan, respectively, with an introduction of a 2027 forecast at 5.442 billion yuan [3] - The projected earnings per share (EPS) for 2025-2027 are 3.55, 3.79, and 3.99 yuan, with corresponding price-to-earnings (PE) ratios of 22x, 20x, and 19x [3]