Investment Rating - The report maintains an "Outperform" rating for the company [2][8] Core Views - The company's performance in 2024 was under pressure, with a revenue of 4.833 billion yuan, a decrease of 4% year-on-year, and a net profit attributable to shareholders of 64 million yuan, down 38% year-on-year [5][8] - In Q1 2025, the company achieved a revenue of 1.148 billion yuan, a year-on-year increase of 9%, but the net profit attributable to shareholders was only 2 million yuan, a decline of 60% year-on-year [5][8] - The report highlights that the demand for massage products in overseas markets was weak, impacting the company's overall performance [8] Financial Data and Profit Forecast - The company’s revenue and profit forecasts for 2025 and 2026 have been adjusted downwards, with expected net profits of 122 million yuan and 160 million yuan respectively, reflecting year-on-year growth rates of 89.6% and 31.0% [7][8] - The report provides a detailed financial summary, indicating a projected revenue of 5.196 billion yuan for 2025, with a gross margin of 36.2% [10][8] - The company’s ROE is expected to improve gradually, reaching 3.8% by 2027 [7][8] Business Segment Performance - The massage chair segment faced challenges, with revenues of 2.047 billion yuan, down 5.34% year-on-year, while the massage small appliances segment saw a modest growth of 8.96% [8] - The company is focusing on technological innovations and exploring new markets, including countries along the "Belt and Road" initiative, with over 50% of revenue coming from its own brand [8] Cost and Expense Management - In Q1 2025, the company reported a gross margin of 34.62%, a decrease of 4.04 percentage points year-on-year, but managed to reduce selling and administrative expense ratios [8]