Investment Rating - The report maintains a "Buy" rating for the company [7][2]. Core Views - The company's profit adjustments due to negative factors such as retail pressure, rising expense ratios, and unclear subsidy expectations are gradually being digested. The current position shows defensive value, with expectations for profit elasticity from future retail improvements. The projected net profit for the company from 2025 to 2027 is estimated at 330 million, 370 million, and 410 million yuan, with corresponding PE ratios of 18, 16, and 14 times [2][5]. Financial Performance Summary - For the first three quarters of 2025, the company reported revenues, net profit attributable to the parent, and net profit excluding non-recurring gains and losses of 3.48 billion, 240 million, and 180 million yuan, respectively, reflecting year-on-year changes of -1.6%, -43.2%, and -49.9%. In Q3 alone, revenues, net profit attributable to the parent, and net profit excluding non-recurring gains and losses were 1.09 billion, 40 million, and 20 million yuan, with year-on-year changes of +3.1%, -45.7%, and -67.6% [5][2]. Expense Analysis - In Q3 2025, the gross profit margin decreased by 0.6 percentage points year-on-year, remaining stable overall. The expense ratio increased by 5.7 percentage points year-on-year, indicating rigidity. The sales, management, R&D, and financial expense ratios increased by 3.8 percentage points, 2.5 percentage points, -0.3 percentage points, and -0.2 percentage points, respectively. The increase in sales expense ratio is primarily attributed to increased brand investment and rising costs related to personnel and rent [11][5].

Investment Rating - The report maintains a "Buy" rating for the company, expecting a stock price increase of over 15% relative to the industry index in the next six months [5][18]. Core Insights - The company experienced a revenue decline of 1.9% in 2024, with a significant drop in net profit by 29.1% due to increased market investment and brand promotion costs [1][2]. - The multi-brand strategy has been successfully implemented, enhancing the company's core competitiveness and risk resistance [9]. - The company has established a balanced development of its brand matrix, with three brands exceeding 1 billion in revenue [4]. Financial Performance Summary - **Revenue and Profit**: - 2023 revenue was 5,254 million, projected to decrease to 5,153 million in 2024, then increase to 5,505 million in 2025 [1]. - Net profit for 2023 was 698 million, expected to drop to 495 million in 2024, with a recovery to 544 million in 2025 [1]. - **Profitability Ratios**: - The gross margin for 2024 is projected at 65.02%, a slight increase from the previous year [2]. - The net profit margin for 2024 is expected to be 10.09%, down 3.78 percentage points year-on-year [2]. - **Earnings Per Share (EPS)**: - The latest diluted EPS for 2024 is projected at 0.34, down from 0.48 in 2023, with a gradual increase expected in subsequent years [1][9]. Brand Performance Summary - **Brand Revenue**: - The Hazzys brand achieved a revenue of 1.781 billion, a growth of 1.29%, while the Lefuye brand saw a significant increase of 27.95% to 335 million [3]. - The Baonia brand's revenue was 1.009 billion, down 2.89%, and the Baoxin brand revenue decreased by 8.35% to 1.585 billion [3]. - **Channel Development**: - The company has established 1,815 offline stores across various key locations and is actively expanding its online presence through major e-commerce platforms [3]. Market Position and Strategy - The company has a well-balanced brand matrix with mature, growth, and nurturing brands, allowing for resource sharing and collaborative development [4]. - The acquisition of the international outdoor brand Woolrich marks a significant step towards enhancing the company's multi-brand strategy and international expansion [9].