客户因低价而来，也因品质问题转身离去。掉色、脱落、售后无门——所有指责最终都指向一线经销商。他们透支多年积累的信誉，为这场恶性竞争兜底。 价格战没有赢家，但经销商一定是输得最惨的那个。当行业陷入"低价=低质"的恶性循环，最先倒下的，永远是那些在一线苦苦支撑的经销商。 别再为价格战喝彩——它正在吞噬这个行业最宝贵的毛细血管。 更残酷的是双重挤压。厂家以"战略合作"为名提高任务量，要求现款压货；终端市场在无休止的降价中变得麻木，货越来越难卖。 经销商困在中间——仓库里堆满同质化产品，现金流日益枯竭，利润薄如刀片。 当"价格直降"、"买十送五"的横幅挂满建材市场时，看似是消费者捡了便宜，实则这场游戏的唯一买单者，只有被套牢的经销商。 厂家发动价格战，牺牲的是品质与服务。低价背后，是乳液比例下调、真石含量缩减、施工监管缺失。经销商被迫拿着缩水产品，却要向客户承诺"二十年 不褪色"。 ...

Investment Rating - The report maintains a "Buy" rating for the company [7] Core Views - The company is experiencing a turning point in operations, supported by the resilience of the retail market and the rapid replication of new business models such as "Immediate Move-In" and "Beautiful Countryside" [1][2] - The overall price competition in the paint industry has temporarily subsided, leading to a steady growth in retail and an improvement in gross margins [2] - The demand for renovation in the paint sector has exceeded 50%, with the "Immediate Move-In" model aligning well with consumer needs in the existing housing market [3] - The company is actively participating in rural revitalization, maintaining the top market share in the imitation stone paint segment [4] Summary by Sections Financial Performance - In the first half of 2025, the company achieved revenues of 1.574 billion, 1.795 billion, 1.733 billion, and 460 million for home decoration wall paint, engineering wall paint, base materials, and waterproof membranes respectively, with year-on-year changes of +8.4%, -2.3%, +10.4%, and -28.6% [2] - The overall gross margin improved to 32.35%, a year-on-year increase of 3.7 percentage points, with specific margins for home decoration wall paint, engineering wall paint, base materials, and waterproof membranes at 49.4%, 35.4%, 20.6%, and 13.8% respectively [2] - The company forecasts net profits of 780 million, 980 million, and 1.21 billion for 2025, 2026, and 2027 respectively, with a compound annual growth rate (CAGR) of 54.0% [5] Market Position and Strategy - The company has over 2,300 "Immediate Move-In" community stores, reaching 420,000 households, with more than 15,000 professional service personnel [3] - The imitation stone paint market in China is projected to reach 22 billion by 2024, with the company holding a market share of 7.6% [4] - The company's revenue from the "Beautiful Countryside" business, primarily based on imitation stone paint, reached 940 million, growing over 50% year-on-year [4] Valuation - The target price for the company is set at 53.19 RMB, with a closing price of 47.71 RMB as of August 27 [11] - The report assigns a 40x price-to-earnings (PE) ratio for 2026, reflecting the strong retail attributes of the paint sector and the potential for domestic brand replacement [5]

Summary of the Conference Call for SanKe Tree Company Overview - **Company**: SanKe Tree - **Industry**: Building Coatings Key Points Industry and Market Dynamics - SanKe Tree maintains operational resilience during the real estate downturn through strategic adjustments and channel transformations, effectively managing accounts receivable and bad debt risks, laying a foundation for future growth [2][3][6] - The building coatings market is expected to see significant growth driven by two main trends: substantial market share increase potential and rising repainting demand [2][7] - The retail market for building materials is currently the most important, with a total demand area of approximately 1.7 billion square meters from 2024 to 2026, while the incremental market faces pressure due to urbanization and real estate downturn [16] Company Performance - In the first half of 2025, SanKe Tree reported a slight revenue increase, outperforming many competitors who experienced revenue declines of over 10% [6][12] - The company anticipates a net profit of 380 to 460 million RMB for the first half of 2025, reflecting an increase of 81% to 119% year-on-year [12] Strategic Focus and Future Growth - The core logic for SanKe Tree's future development includes enhancing market share and increasing repainting demand, with current retail market share at less than 8% compared to Nippon Paint's 30% [4][7] - The company has introduced three new business transformation strategies, including accelerating the layout of stock renovation and offline channels, leveraging rural beautification subsidies, and creating a high-end product matrix with artistic paints [12][20] - SanKe Tree aims to achieve a profit of approximately 800 to 1,000 million RMB by 2025, with long-term goals to match Nippon Paint's revenue of over 20 billion RMB [11][30] Competitive Positioning - SanKe Tree has established a competitive advantage in the building coatings market, maintaining a strong market position alongside Nippon Paint [3] - The company has a comprehensive product system covering various segments, including imitation stone paint, latex paint, waterproof coatings, adhesives, and more, enhancing customer stickiness through a one-stop service model [23] Risk Management - The company has effectively managed accounts receivable risks, with a single-item impairment exposure of approximately 261 million RMB in 2024, representing 79% of its total [29] - The short-term outlook for the engineering coatings market remains weak, with an expected annual decline of 2.3% from 2024 to 2026, but SanKe Tree is shifting focus from large B direct sales to small B distribution channels to mitigate risks [28] Market Trends - The second-hand housing market is expected to remain robust, with a projected 60% share of transactions in 2024, driving demand for related products [17] - Home renovation is a strong demand driver, with retail sales of building materials showing positive month-on-month growth since 2025 [18][19] Conclusion - SanKe Tree is positioned for sustainable growth through strategic adjustments, effective risk management, and a focus on enhancing market share and product offerings in the building coatings industry [2][11][30]

Investment Rating - The report maintains a "Buy" rating for the company with a target price of RMB 53.19, based on a 40x PE for 2026 [1][6]. Core Views - The company is transitioning from incremental to stock demand in the domestic market, focusing on three new retail formats to enhance brand strength and drive sustainable revenue growth [1][14]. - The company is expected to see a profit margin inflection point and operational performance elasticity due to steady market share gains in the small B and C-end markets, alongside improved product and channel offerings [1][14]. Summary by Sections Retail Business - The company is targeting a total home decoration demand area of approximately 1.7 billion square meters from 2024 to 2026, with a compound annual growth rate (CAGR) of 5.0% for stock renovation demand, leading to a retail paint market exceeding RMB 60 billion annually [2][14]. - The company's retail market share is projected to reach about 7.9% in 2024, indicating significant room for growth compared to competitors [2][14]. Engineering Coatings - The company has shifted its channel strategy towards engineering distribution, with small B distribution revenue maintaining steady growth at a CAGR of 13.1% from 2020 to 2024, despite a decline in large B direct sales [3][16]. - The engineering coatings market is estimated to be around RMB 50-60 billion annually, with the company's market share expected to stabilize around 13% [3][16]. Market Positioning - The company is evolving from a single paint manufacturer to a comprehensive service provider, integrating paint, consulting, and construction services, which is expected to become a new growth driver [4][15]. - The company has established a solid position in the engineering market, with a stable market share and improved accounts receivable turnover, indicating a controlled risk environment [14][16]. Profit Forecast and Valuation - The company has adjusted its net profit forecasts for 2025-2027 to RMB 7.8 billion, RMB 9.8 billion, and RMB 12.1 billion, respectively, reflecting a CAGR of 54.0% [5][14]. - The target price of RMB 53.19 is based on a 40x PE for 2026, with the company expected to benefit from the rapid replication of new business formats and reduced impairment risks [5][14].

Investment Rating - The report maintains a "Buy" rating for the company, indicating an expected price increase of over 15% in the next 6-12 months [5][13]. Core Insights - The company is projected to achieve a net profit attributable to shareholders of 3.8-4.6 billion RMB in the first half of 2025, representing a year-on-year increase of 80.94%-119.04% [2]. - The company’s retail business continues to grow against the backdrop of a declining real estate market, with revenue growth rates for home decoration wall paint projected at 18.2%, 2.6%, and 12.8% from 2022 to 2024 [3]. - Gross margin is recovering, with a gross margin of 32.5% in Q4 2024, up 0.44 percentage points year-on-year, and 31.05% in Q1 2025, up 2.67 percentage points year-on-year [4]. - The company is expected to achieve net profits of 9.0 billion RMB and 12.5 billion RMB for 2025 and 2026, respectively, with corresponding P/E ratios of 31.0 and 22.3 [5]. Performance Summary - The company reported a historical high in total profit for the first half of 2025, with a net profit forecast midpoint of 4.2 billion RMB [2]. - The company has effectively reduced expenses through improved operational efficiency, with a 2024 expense ratio of 25.7%, down 0.5 percentage points year-on-year [4]. - The revenue forecast for the company shows a slight decline in 2024, followed by a recovery with growth rates of 8.00% and 12.49% in 2025 and 2026, respectively [10]. Financial Projections - The projected diluted earnings per share for 2025 is 1.221 RMB, with a significant increase in net profit growth rate expected at 171.32% [10]. - The return on equity (ROE) is expected to rise to 27.92% in 2025 and stabilize around 30.91% by 2027 [10]. Market Sentiment - The report indicates a favorable competitive landscape in the incremental market segments, with sustained demand despite the overall industry challenges [3]. - The company’s strategic focus on consumer-oriented growth and product structure optimization is expected to drive profitability and market share [4].

Core Viewpoint - The development of imitation stone paint is significantly influenced by policy environment and industry standards, which provide direction and assurance for the industry while ensuring product quality and safety [1][8][13]. Group 1: Policy Impact on the Imitation Stone Paint Industry - Recent government policies in China, such as the "Green Building Action Plan" and the "13th Five-Year Plan for Building Energy Efficiency and Green Building Development," promote the application of green building materials and energy-saving technologies, providing support for the imitation stone paint industry [3][5][8]. - These policies not only drive technological innovation and product upgrades in the imitation stone paint sector but also promote market standardization and healthy development [8][11]. Group 2: Industry Standards and Their Implementation - A series of product standards and construction specifications for imitation stone paint have been established, such as China's "Exterior Wall Imitation Stone Coating" standard and the U.S. "ASTM D7087-16a" standard, which detail performance indicators, construction processes, and testing methods [9][10]. - The implementation of strict product standards helps prevent inferior products from entering the market, protecting consumer rights and promoting technological progress and product upgrades within the industry [9][11]. Group 3: International Standards and Certification Systems - International standards and certification systems, such as ISO 12944 and EN 1062, provide technical basis for market access and enhance the international competitiveness of imitation stone paint products [10]. - Obtaining international certifications like ISO 9001 and ISO 14001 allows companies to demonstrate compliance with international standards, improving brand image and market credibility [10]. Group 4: Future Trends in Policy and Standards - Future policies are expected to focus more on environmental protection and sustainable development, potentially leading to stricter regulations for the imitation stone paint industry [12]. - Industry standards will continue to evolve, emphasizing product performance and quality, with possible new standards aimed at improving weather resistance, stain resistance, and self-cleaning properties [12]. Group 5: Conclusion - Overall, policies and industry standards play a crucial role in driving the development of the imitation stone paint industry, fostering green transformation and technological innovation [13]. - Companies in the imitation stone paint sector should proactively adapt to changes in policies and standards to enhance product technology and market competitiveness, promoting sustainable development [13].