Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The company reported its Q3 2025 performance, with revenue showing a year-on-year decline of 20.76% to 1.356 billion yuan and net profit down 39.01% to 381 million yuan [6] - The company is facing increased competition in its home province, weakening macro demand, and strategic adjustments in low-end products, but is focusing on refined channel operations to stabilize its core business [5] - The revenue for the first three quarters of 2025 totaled 4.516 billion yuan, a year-on-year decrease of 18.09%, with net profit down 24.67% [6] Financial Performance Summary - Q3 2025 revenue was 1.356 billion yuan, with a net profit of 381 million yuan, and a non-recurring net profit also at 381 million yuan [6] - For the first three quarters of 2025, revenue was 4.516 billion yuan, with a net profit of 1.511 billion yuan [6] - The company’s gross margin decreased by 5.7 percentage points to 70.2% due to product mix adjustments, while sales and management expense ratios increased [6] - The company’s cash flow performance matched its revenue, with a year-on-year decline in sales cash receipts of 17.3% [6] Revenue Breakdown - In Q3 2025, revenue from mid-to-high-end and ordinary liquor declined by 21.8% and 22.8% year-on-year, respectively, with mid-to-high-end liquor accounting for 79.6% of total liquor revenue [6] - Revenue from the company’s home province decreased by 21.6%, while revenue from outside the province fell by 22.7%, with the decline in the latter showing a narrowing trend compared to Q2 2025 [6] Profitability Forecast - The company’s profitability forecast has been adjusted, expecting total revenue of 6.007 billion yuan in 2025, down 18.2% year-on-year, and net profit of 1.945 billion yuan, down 24.9% [7] - The projected P/E ratios for 2025, 2026, and 2027 are 17, 16, and 15 times, respectively, maintaining a "Buy" rating [7]

Core Insights - The company reported a revenue of 7.34 billion yuan for 2024, representing a year-on-year increase of 8.5%, and a net profit attributable to shareholders of 2.59 billion yuan, up 13.5% year-on-year [1] - For Q1 2025, the company achieved a revenue of 2.05 billion yuan, down 12.3% year-on-year, and a net profit of 830 million yuan, down 9.5% year-on-year [1] Financial Performance - In Q4 2024, the company recorded a revenue of 1.83 billion yuan, a decrease of 5.0%, and a net profit of 580 million yuan, down 4.9% [1] - The company plans to distribute a cash dividend of 1.5 yuan per share, totaling 1.2 billion yuan, which accounts for 46.35% of the net profit attributable to shareholders [1] - The dividend yield is estimated at 3.1% based on the market capitalization as of April 28, 2025 [1] Product and Market Analysis - In 2024, the revenue from mid-to-high-end liquor was 5.71 billion yuan, an increase of 13.8% year-on-year, while ordinary liquor revenue was 1.29 billion yuan, down 6.5% [2] - For Q1 2025, mid-to-high-end liquor revenue decreased by 8.6%, and ordinary liquor revenue fell by 32.1%, attributed to the early Spring Festival, weak consumption, and proactive destocking [2] - The company's revenue from the domestic market was 5.09 billion yuan, up 12.8% year-on-year, while revenue from outside the province was 1.91 billion yuan, up 1.3% [2] Profitability and Cost Structure - The gross profit margin for 2024 was 73.9%, an increase of 2.6 percentage points year-on-year, benefiting from improved product mix [3] - For Q1 2025, the gross profit margin was 76.5%, up 1.4 percentage points year-on-year, with sales expense ratio and management expense ratio increasing slightly [3] - The net profit margin for 2024 was 35.3%, up 1.2 percentage points year-on-year, and for Q1 2025, it was 40.6%, also up 1.2 percentage points year-on-year [3] Earnings Forecast and Investment Recommendation - Based on the Q1 2025 report, revenue forecasts for 2025-2026 have been lowered, while gross margin and expense ratios have been adjusted upwards [4] - The projected earnings per share for 2025, 2026, and 2027 are 3.37 yuan, 3.91 yuan, and 4.46 yuan, respectively [4] - The company is considered to have a reasonable valuation level of 17 times the price-to-earnings ratio for 2025, with a target price of 57.29 yuan, maintaining a buy rating [4]