Company Overview - Sanke Tree Co., Ltd. is located in Putian City, Fujian Province, and was established on July 17, 2003. The company went public on June 3, 2016. Its main business includes the research, production, and sales of architectural coatings (wall coatings), wood coatings, waterproof materials, flooring materials, insulation materials, integrated boards, and base materials [1]. Financial Performance - As of June 30, 2025, Sanke Tree achieved operating revenue of 5.816 billion yuan, representing a year-on-year growth of 0.97%. The net profit attributable to shareholders was 436 million yuan, showing a significant year-on-year increase of 107.53% [2]. - The company has distributed a total of 733 million yuan in dividends since its A-share listing, with 253 million yuan distributed over the past three years [3]. Stock Performance - As of September 29, the stock price of Sanke Tree increased by 2.01%, reaching 47.27 yuan per share, with a total market capitalization of 34.877 billion yuan. The stock has risen by 56.52% year-to-date [1]. - The stock has seen a 2.65% increase over the last five trading days, a 1.38% decrease over the last 20 days, and a 22.91% increase over the last 60 days [1]. Shareholder Structure - As of June 30, 2025, the number of shareholders increased by 15.34% to 14,200, with an average of 52,109 circulating shares per person, up by 21.38% [2]. - Notable shareholders include Hong Kong Central Clearing Limited, which holds 13.3691 million shares, and several funds such as Invesco Great Wall and Southern CSI 500 ETF, which have recently entered the top ten circulating shareholders [3]. Business Segmentation - The main revenue sources for Sanke Tree are as follows: engineering wall paint (30.87%), base and auxiliary materials (29.79%), home decoration wall paint (27.07%), waterproof membranes (7.91%), and others (2.32%) [1].

Investment Rating - The report maintains an "Accumulate" rating for the company, SanKeTree (603737) [2][4]. Core Views - The company achieved significant growth in performance due to channel structure adjustments and a focus on retail, with a notable increase in net profit and earnings per share [2][3]. - The company is actively expanding its customer base and optimizing channel structures, targeting high-quality sectors such as central and state-owned enterprises, urban construction, and industrial plants [3][4]. Summary by Relevant Sections Financial Performance - In the first half of 2025, the company reported revenue of 5.816 billion yuan, a year-on-year increase of 0.97%. Net profit attributable to shareholders reached 436 million yuan, up 107.53% year-on-year, with basic earnings per share of 0.59 yuan, a 103.45% increase [3]. - The second quarter saw revenue of 3.686 billion yuan, a slight decrease of 0.24% year-on-year, while net profit attributable to shareholders was 331 million yuan, an increase of 102.97% [3]. Business Segments - The company's business segments showed varied performance: - Engineering wall paint generated revenue of 1.795 billion yuan, down 2.26% year-on-year, with a gross margin of 35.42% [3]. - Base and auxiliary materials revenue was 1.733 billion yuan, up 52.79% year-on-year, with a gross margin of 20.62% [3]. - Home decoration wall paint revenue reached 1.574 billion yuan, an increase of 8.43% year-on-year, with a gross margin of 49.41% [3]. Profitability and Cost Management - The overall gross margin for the first half was 32.35%, up 3.70 percentage points year-on-year, with a net profit margin of 7.49%, an increase of 3.85 percentage points [3]. - The company effectively managed expenses, with total expense ratio decreasing by 1.57 percentage points to 23.67% [3]. Cash Flow and Asset Management - The company improved its asset structure, with a debt-to-asset ratio of 76.45%, down 4.45 percentage points year-on-year. Accounts receivable decreased by 15.17% to 3.577 billion yuan, indicating enhanced management capabilities [3]. - Operating cash flow showed a net inflow of 351 million yuan, an increase of 393 million yuan year-on-year [3]. Future Outlook - The company is expected to continue its growth trajectory, with projected earnings per share of 1.04 yuan and 1.37 yuan for 2025 and 2026, respectively, corresponding to price-to-earnings ratios of 47 times and 35 times [4].

建筑材料/装修建材 三棵树（603737.SH） 2025 年 08 月 28 日 投资评级：买入（维持） | 日期 | 2025/8/28 | | --- | --- | | 当前股价(元) | 48.70 | | 一年最高最低(元) | 55.38/26.30 | | 总市值(亿元) | 359.32 | | 流通市值(亿元) | 359.32 | | 总股本(亿股) | 7.38 | | 流通股本(亿股) | 7.38 | | 近 3 个月换手率(%) | 40.13 | 8 月 25 日上海市住房城乡建设管理委员会等部门联合印发《关于优化调整本市房地 产政策措施的通知》，进一步放宽楼市限购政策。此外，三棵树发布 2025 年中报， 2025H1 公司实现营收 58.16 亿元，同比+0.97%；归母净利润 4.36 亿元，同比 +107.53%；扣非归母净利润 2.92 亿元，同比+268.48%。2025Q2 单季度营收 36.86 亿元，环比+73%；归母净利润 3.31 亿元，环比+214.49%；扣非归母净利润 3.07 亿 元，环比增加 3.22 亿元。考虑原材料价格下行，我们上调 2025 ...

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]

Investment Rating - The report maintains an "Outperform the Market" rating for the company [4][6][42] Core Views - The company demonstrates resilient revenue growth with a 0.97% year-on-year increase in revenue for H1 2025, reaching 5.82 billion yuan, while net profit surged by 107.5% to 440 million yuan [1][9] - The retail transformation is gaining momentum, with both volume and price increases in home decoration paints, indicating a successful channel upgrade [2][12] - The gross margin continues to improve, reaching 32.4% in H1 2025, up 3.7 percentage points year-on-year, driven by a higher proportion of C-end sales and price increases [3][34] - Operating cash flow turned positive and significantly improved, with a net cash flow of 350 million yuan in H1 2025, reflecting a healthier financial structure [3][38] Summary by Sections Financial Performance - In H1 2025, the company achieved a revenue of 5.82 billion yuan, with a net profit of 440 million yuan, and a non-recurring net profit of 290 million yuan, marking increases of 107.5% and 268.5% respectively [1][9] - The second quarter saw a slight revenue decline of 0.2% year-on-year, but net profit still grew by 103% [1][9] Product Segmentation - Home decoration wall paint revenue increased by 8.4% to 1.57 billion yuan, while engineering wall paint revenue decreased by 2.3% to 1.79 billion yuan [2][12] - The company is focusing on high-end product matrices and successfully replicating new retail models [2][15] Margin and Cost Management - The comprehensive gross margin improved to 32.4%, with a reduction in expense ratios across various categories, including sales and management [3][34] - The operating cash flow for H1 2025 was 350 million yuan, showing a significant improvement from the previous year [3][38] Future Outlook - The company is expected to continue its growth trajectory, with projected EPS of 1.63, 2.08, and 2.74 yuan for 2025, 2026, and 2027 respectively, indicating a strong potential for future profitability [4][42]

Core Viewpoint - The company reported significant growth in revenue and profit for the first half of 2025, driven by strategic transformation and improved operational efficiency [1][2][3] Financial Performance - The company achieved a revenue of 5.816 billion yuan, a year-on-year increase of 0.97%, and a net profit attributable to shareholders of 436 million yuan, up 107.53% [1] - The company's net profit after deducting non-recurring items reached 292 million yuan, reflecting a substantial increase of 268.48% year-on-year [1] - In Q2 2025, the company recorded a revenue of 3.686 billion yuan, a slight decrease of 0.24% year-on-year, while net profit attributable to shareholders was 331 million yuan, an increase of 102.97% [1] Product Performance - Revenue from various product segments for the first half of the year was as follows: home decoration wall paint 1.574 billion yuan (up 8.43%), engineering wall paint 1.795 billion yuan (down 2.26%), substrates and auxiliary materials 1.733 billion yuan (up 10.40%), and waterproof membranes 460 million yuan (down 28.62%) [1] - Excluding the impact of waterproof coatings, revenue from home decoration wall paint increased by 13.45% year-on-year [1] Channel and Regional Performance - Revenue from distribution and direct sales channels was 5.088 billion yuan (down 0.49%) and 728 million yuan (up 12.52%), respectively [1] - Domestic revenue was 5.681 billion yuan (up 0.41%), while international revenue reached 135 million yuan, reflecting a year-on-year increase of 31.07% [1] Cost and Profitability - The average selling prices for various products were as follows: home decoration wall paint 5.92 yuan/kg (up 2.78%), engineering wall paint 3.35 yuan/kg (down 8.47%), substrates and auxiliary materials 1.18 yuan/kg (down 16.31%), and waterproof membranes 14.06 yuan/kg (down 5.13%) [2] - The average procurement prices for products were: home decoration wall paint 2.42 yuan/kg (down 12.95%), engineering wall paint 0.93 yuan/kg (down 17.70%), substrates and auxiliary materials 3.43 yuan/kg (up 6.19%) [2] - The company's gross margin and net margin were 32.35% and 7.48%, respectively, with year-on-year increases of 3.70 and 3.87 percentage points [2] - The overall expense ratio improved by 1.57 percentage points to 23.67%, with specific changes in sales, management, financial, and R&D expense ratios [2] Cash Flow and Asset Management - The company reported a net cash flow from operating activities of 351 million yuan, turning positive due to increased receivables [2] - The total amount of asset impairment was 101 million yuan, a decrease of 58 million yuan year-on-year [2] Investment Outlook - The company is expected to achieve net profits attributable to shareholders of 870 million yuan, 1.04 billion yuan, and 1.26 billion yuan for 2025 to 2027, representing year-on-year growth of 162%, 19%, and 22%, respectively [3] - The company maintains a focus on strategic transformation, with ongoing efforts in retail business expansion and operational efficiency improvements [3]

Investment Rating - The report maintains a "Buy" rating for the company, expecting a stock price increase of 5% to 15% relative to the industry index over the next six months [4]. Core Views - The company has significantly improved its performance year-on-year, with a notable upgrade in product structure. The strategic transformation has yielded positive results, particularly in retail and engineering business segments [3][4]. - The company achieved a revenue of 5.816 billion yuan in the first half of 2025, a year-on-year increase of 0.97%, and a net profit attributable to shareholders of 436 million yuan, up 107.53% year-on-year [1][2]. Financial Performance Summary - **Revenue and Profit**: The company’s revenue is projected to reach 12.476 billion yuan in 2023, with a growth rate of 10%. By 2027, revenue is expected to grow to 16.091 billion yuan, reflecting a growth rate of 12% [1]. - **Net Profit**: The net profit attributable to shareholders is forecasted to be 174 million yuan in 2023, with a significant increase to 1.261 billion yuan by 2027, indicating a growth rate of 21.7% [1]. - **Earnings Per Share (EPS)**: The latest diluted EPS is projected to rise from 0.24 yuan in 2023 to 1.71 yuan in 2027 [1]. - **Valuation Ratios**: The Price-to-Earnings (P/E) ratio is expected to decrease from 186.6 in 2023 to 25.7 in 2027, while the Price-to-Book (P/B) ratio is projected to decline from 13.2 to 6.0 over the same period [1]. Product and Market Analysis - **Product Segmentation**: In the first half of 2025, the company’s revenue from home decoration wall paint, engineering wall paint, substrates and auxiliary materials, and waterproof rolls were 1.574 billion, 1.795 billion, 1.733 billion, and 460 million yuan respectively, with home decoration wall paint showing a year-on-year increase of 13.45% [1][2]. - **Sales Channels**: The company’s revenue from distribution and direct sales channels was 5.088 billion and 728 million yuan respectively, with direct sales showing a year-on-year increase of 12.52% [1]. - **Geographical Performance**: Domestic revenue was 5.681 billion yuan, a year-on-year increase of 0.41%, while international revenue reached 135 million yuan, up 31.07% [1]. Cost and Profitability Analysis - **Cost Management**: The average procurement prices for home decoration and engineering wall paints decreased by 12.95% and 17.70% respectively, contributing to improved profitability [2]. - **Profit Margins**: The company’s gross margin and net margin were 32.35% and 7.48% respectively, reflecting an increase of 3.70 and 3.87 percentage points year-on-year [2]. - **Cash Flow**: The net cash flow from operating activities turned positive at 351 million yuan, primarily due to increased receivables collection [2].

Core Viewpoint - The company reported significant growth in revenue and net profit for the first half of 2025, outperforming its main competitor in the wall paint segment, indicating a successful differentiation strategy in products and services [1][2][3] Financial Performance - For the first half of 2025, the company achieved revenue of 5.82 billion yuan, a year-on-year increase of 1%, with net profit attributable to shareholders reaching 440 million yuan, up 107.5%, and net profit excluding non-recurring items at 290 million yuan, up 268.5% [1] - In Q2 2025, revenue was 3.69 billion yuan, with net profit attributable to shareholders at 330 million yuan, and net profit excluding non-recurring items at 310 million yuan, showing year-on-year changes of -0.2%, +103%, and +96% respectively [1] Product Performance - The company's wall paint revenue significantly outperformed competitor N, with home decoration wall paint and engineering wall paint revenues at 1.57 billion yuan and 1.80 billion yuan respectively, showing year-on-year changes of +8.4% and -2.3% [1] - Excluding the impact of waterproof coating revenue, home decoration and engineering wall paint revenues grew by 13.5% and -2.7% respectively, leading to a combined growth of 4.6% [1] Competitive Strategy - The company's success is attributed to its differentiated product and service strategy, focusing on multi-channel approaches in rural and urban markets through initiatives like "Beautiful Countryside" and "Immediate Move" [2] - The gross profit margin in Q2 increased by 4.3 percentage points, reflecting improved pricing power and product competitiveness in the retail sector [2] Cost Management - The company achieved a reduction in sales and administrative expense ratio by 1.6 percentage points in the first half of 2025, primarily due to lower sales and financial expense ratios [2] - The asset-liability ratio at the end of the first half of 2025 was 76.45%, down 4.5 percentage points year-on-year, indicating improved financial health [2] Future Outlook - Revenue projections for 2025 to 2027 are 13.03 billion yuan, 14.49 billion yuan, and 16.10 billion yuan, with year-on-year growth rates of 7.61%, 11.26%, and 11.07% respectively [3] - Net profit forecasts for the same period are 891 million yuan, 1.07 billion yuan, and 1.31 billion yuan, with substantial growth rates of 168.55%, 20.19%, and 22.32% respectively [3] - The company is positioned as a leading domestic paint manufacturer, with a strong recommendation rating based on improved operational fundamentals and competitive performance [3]

Core Viewpoint - The report highlights significant improvements in the profitability of SanKeTree (三棵树) due to structural enhancements in its product offerings and effective cost control measures, despite facing challenges in revenue growth and competition in the waterproofing sector [1][2][3][4]. Financial Performance - In the first half of the year, the company achieved revenue of 5.816 billion yuan, a year-on-year increase of 0.97%, and a net profit attributable to shareholders of 436 million yuan, up 107.53% [2]. - The second quarter saw revenue of 3.686 billion yuan, a slight decline of 0.24% year-on-year, while net profit reached 331 million yuan, reflecting a growth of 102.97% [2]. Product Performance - Revenue from various product segments in the first half included: home decoration wall paint (1.574 billion yuan, +8.43%), engineering wall paint (1.795 billion yuan, -2.26%), base materials (1.733 billion yuan, +10.40%), and waterproofing membranes (460 million yuan, -28.62%) [3]. - The average price of home decoration wall paint increased by 3% to 5.9 yuan/kg, while the average price of engineering wall paint decreased by 8.5% to 3.4 yuan/kg [3]. Profitability and Cost Control - The company's gross margin improved to 32.35%, an increase of 3.7 percentage points year-on-year, with specific margins for product segments being: home decoration wall paint (49.41%, +5.5), engineering wall paint (35.42%, +2.9), base materials (20.62%, +5.3), and waterproofing membranes (13.8%, -0.9) [3]. - The net profit margin for the first half was 7.48%, up 3.85 percentage points year-on-year, with Q2 net profit margin at 8.94% [4]. - The company effectively controlled its expenses, with a total expense ratio of 23.67%, down 1.57 percentage points year-on-year [4]. Future Outlook - Revenue projections for 2025 and 2026 are estimated at 13.19 billion yuan and 14.89 billion yuan, representing year-on-year growth of 9.0% and 12.9%, respectively [4]. - Expected net profits for 2025 and 2026 are forecasted at 1.03 billion yuan and 1.18 billion yuan, with significant growth rates of 210.9% and 14.0% [4].

Investment Rating - The investment rating for the company is "Buy," indicating an expected relative increase in stock price of over 20% compared to the benchmark index within six months [13]. Core Views - The company reported significant improvement in profitability in Q2 2025, with a notable increase in net profit by 102.97% year-on-year, driven by structural enhancements in its product offerings [5][6]. - The company's revenue for the first half of 2025 was 5.8 billion yuan, a slight increase of 0.97% year-on-year, while the net profit reached 436 million yuan, marking a substantial growth of 107.53% [5]. - The company is experiencing a shift in its product mix, with a focus on retail new formats, which has positively impacted its gross margin, reaching 32.35%, an increase of 3.7 percentage points year-on-year [6][7]. Financial Performance Summary - The company achieved a revenue of 58.16 billion yuan in H1 2025, with a net profit of 4.36 billion yuan, reflecting a year-on-year growth of 107.53% [5]. - The gross margin for the company's products showed improvement, with the gross margin for home decoration wall paint at 49.41%, an increase of 5.5 percentage points year-on-year [6]. - The company’s net profit margin improved to 7.48% in H1 2025, with Q2 showing a net profit margin of 8.94%, indicating effective cost control measures [7]. Earnings Forecast - The company is projected to achieve revenues of 131.9 billion yuan and 148.9 billion yuan in 2025 and 2026, respectively, representing growth rates of 9.0% and 12.9% [8]. - The forecasted net profit for 2025 and 2026 is expected to be 10.3 billion yuan and 11.8 billion yuan, reflecting significant growth of 210.9% and 14.0% year-on-year [8].