Core Viewpoint - The company Tianmu Lake (603136.SH) has reported a continuous decline in revenue for five consecutive quarters, with a significant drop in both revenue and net profit for 2024, indicating a challenging development situation amidst a recovering domestic tourism market [1][2][3]. Group 1: Core Scenic Area Business - The core scenic area business, which accounts for over 50% of the company's revenue, experienced a significant decline, with revenue for 2024 reaching 282.4 million yuan, down 13.03% year-on-year, and main profit dropping by 32.5% [2][3][4]. - The main profit margin for the scenic area business decreased to 70.43%, a reduction of 0.81 percentage points compared to the previous year [2][3]. - The two major 5A scenic areas, Shanshui Garden and Nanshan Bamboo Sea, both saw declines in revenue and main profit for 2024, with Shanshui Garden's revenue down 17.47% and Nanshan Bamboo Sea's down 7.58% [4][5]. Group 2: Hotel Business - The hotel business, which contributes nearly 30% to the company's revenue, also faced a sharp decline, with 2024 revenue falling to 159.4 million yuan, a decrease of 23.1%, and main profit down 27.86% [6][7]. - The gross profit margin for the hotel business dropped significantly from 29.88% to 21.4%, indicating substantial operational pressure [6][7]. - The performance of the hot spring and water world businesses, aimed at boosting off-peak season revenue, also saw significant declines, with the water world business revenue plummeting by 41.28% [7]. Group 3: Fundraising Projects - The company has two fundraising projects initiated in 2020 that have faced multiple delays, with the expected completion dates pushed back to December 2025 [8][10]. - The South Mountain Xiaozhai project and the Yushui Hot Spring renovation project have seen minimal progress, with only 8.14% of the projects completed as of the latest updates [10]. - The prolonged delays and changing market conditions raise uncertainties about the future performance of these projects, which were intended to enhance the company's competitiveness and profitability [10].

Investment Rating - The investment rating for the company is "Buy" with a target price indicating an expected relative return of over 20% within six months [9][16]. Core Views - The company is expected to achieve a revenue of 540 million yuan in 2024, a decrease of 14.9% year-on-year, and a net profit of 100 million yuan, down 28.8% year-on-year due to external market conditions [1]. - In Q1 2025, the company reported a revenue of 100 million yuan, a slight decline of 1.6% year-on-year, but a net profit increase of 26.45% year-on-year, indicating effective cost control [1][3]. - The company aims for a revenue of 580 million yuan in 2025, representing an 8.6% growth, and a net profit of 150 million yuan, up 22.8% year-on-year [4]. Revenue Breakdown - In 2024, the scenic area business is projected to generate 280 million yuan, down 13.0% year-on-year, with specific declines in revenue from various attractions [2]. - The hotel business is expected to see a revenue drop of 23.1% to 160 million yuan, while the water world business is anticipated to decline by 41.3% to 7.46 million yuan [2]. Profitability Analysis - The gross margin for 2024 is forecasted at 52.4%, a decrease of 1.9 percentage points year-on-year, with various business segments experiencing declines in gross margins [3]. - In Q1 2025, the gross margin improved to 41.4%, an increase of 3.3 percentage points year-on-year, reflecting better cost management [3]. Financial Projections - The company forecasts a net profit of 140.59 million yuan for 2025, with corresponding P/E ratios of 23, 21, and 18 for the years 2025 to 2027 [4][6]. - The projected revenue growth rates for the years 2025 to 2027 are 8.94%, 9.31%, and 9.52%, respectively [6].