Investment Rating - The investment rating for the company is "Buy" (maintained) [4] Core Views - The company has shown a continuous upgrade in product structure, with a short-term slowdown in growth. The revenue from mid-to-high-end liquor reached 5.7 billion yuan, up 14% year-on-year, while ordinary liquor revenue was 1.3 billion yuan, down 7% year-on-year [2] - The company achieved a total revenue of 73.44 billion yuan in 2024, representing an 8% year-on-year increase, with a net profit of 25.89 billion yuan, up 13% [8] - The company is expected to maintain growth due to strong demand in the domestic banquet consumption market and competitive advantages in the mid-range price segment [8] Financial Summary - Revenue projections for the company are as follows: 2024: 73.44 billion yuan, 2025E: 75.60 billion yuan, 2026E: 79.59 billion yuan, 2027E: 86.42 billion yuan [4] - Net profit projections are: 2024: 25.89 billion yuan, 2025E: 26.69 billion yuan, 2026E: 28.41 billion yuan, 2027E: 31.24 billion yuan [4] - Earnings per share (EPS) are projected to be: 2024: 3.24 yuan, 2025E: 3.34 yuan, 2026E: 3.55 yuan, 2027E: 3.91 yuan [4] - The company’s price-to-earnings (P/E) ratio is projected to decrease from 13.57 in 2024 to 11.25 in 2027 [4] Product and Market Performance - In 2024, the company achieved revenue of 51 billion yuan from the domestic market, up 13% year-on-year, while revenue from the external market was 19 billion yuan, up 1% [2] - The company added 19 distributors in the domestic market but lost 27 in the external market in 2024 [2] - In Q1 2025, the company reported a revenue of 16.33 billion yuan from the domestic market, down 8%, and 3.29 billion yuan from the external market, down 30% [2]

Core Viewpoint - The financial performance of Yingjia Gongjiu has disappointed investors, with a notable decline in revenue and net profit in Q1 2025, despite maintaining growth in 2024 [2][3] Financial Performance - In 2024, Yingjia Gongjiu achieved revenue of 7.344 billion yuan, a year-on-year increase of 8.46%, and a net profit of 2.589 billion yuan, up 13.45% [3] - However, in Q4 2024, the company experienced a revenue decline of 4.5% and a net profit decrease of 7.9% compared to the previous year [3] - For Q1 2025, revenue was 2.047 billion yuan, down 12.35% year-on-year, and net profit was 829 million yuan, a decrease of 9.54% [3] Market Challenges - The company faced its first revenue decline in its home market of Anhui in nearly three years during Q1 2025, indicating increased competition from national brands [2][6] - The overall economic environment and weak consumer spending were cited as reasons for the poor performance in Q1 2025 [3][4] - Competitors such as Moutai and Wuliangye have intensified their market penetration in Anhui, putting additional pressure on Yingjia Gongjiu [6][7] Sales and Marketing Strategy - Despite the decline in performance, the company has not reduced its sales expenses, which were 158 million yuan in Q1 2025, a slight increase of 0.8% year-on-year [5] - The company plans to maintain stable sales expenses throughout the year and is focusing on enhancing its marketing resilience and deepening its presence in the Anhui market [7] Future Outlook - Yingjia Gongjiu aims to strengthen its core competitiveness by leveraging its unique ecological brewing concept and differentiating itself in the market [7] - The company recognizes the need for transformation in response to the evolving market dynamics, including developing experiential marketing and online sales channels [4][7]