Events:
Qisheng Technology released its half-yearly report in 2023: 2023H1 achieved operating income of 1.523 billion yuan / year-on-year + 6.25%, net profit of 122 million yuan / year-on-year + 24.73%, and deducted non-return net profit of 102 million yuan / year-on-year-18.13%.
Main points of investment:
Q2 performance is eye-catching, the performance is high compared with the same period last year. 2023H1 achieved operating income of 1.523 billion yuan / year-on-year + 6.25%, net profit of 122 million yuan / year-on-year + 24.73%, and non-return net profit of 102 million yuan / year-on-year-18.13%. Among them, 2023Q2 realized operating income of 826 million yuan / year-on-year + 19.89%, net profit of 98 million yuan / year-on-year + 136.06%, and non-return net profit of 92 million yuan / year-on-year + 44.34%.
Attach importance to the offline experience characteristics of intelligent beds and strengthen the construction of domestic offline stores. 2023H1 has opened "Shuford" stores in Beijing, Shanghai, Suzhou and other cities, as well as 17 "Shuford" distribution stores in 13 urban areas, including Hangzhou, Nanjing and Zhuhai. The operating performance of stores is remarkable, and the sales volume of individual stores in Beijing has exceeded one million in April. The company plans to add 2 flagship stores, 17 direct stores and 350 distribution stores nationwide, and we expect the company's domestic sales to grow rapidly with the landing of more stores.
The cost side has improved and the gross margin has increased. 2023H1's gross profit margin is 33.43% / year-on-year + 1.33pctbot 2023Q2 gross profit margin is 31.49% / year-on-year + 2.39pct. The gross profit margin increased year-on-year due to the decline in raw material prices and shipping prices (some of the company's non-FOB business) during the reporting period, especially Q2.
Strengthen brand promotion and actively expand the domestic market. The period expense rate of 2023H1 company is 19.91% / year-on-year + 3.72pct, in which the sales / management / finance / R & D expense rate is 13.62% + 3.91/-1.25/+1.06/-0.27pct, respectively. The company actively develops the domestic market, enhances brand awareness by participating in various exhibitions, star endorsements and cooperation with CCTV, focuses on offline sales network, builds Shuford brand, and increases marketing investment.
Profit forecast and investment rating: as the leader of intelligent electric bed, the company benefits from the increase of electric bed permeability in the long run, and the customer inventory is removed to improve the company's orders in the short term. We estimate that the company's operating income from 2023 to 2025 will be 30.06 million yuan, and its net profit will be 2.28 million yuan, respectively. Corresponding to the PE valuation of 21-14-13, it will be covered for the first time, and the company will be given an "overweight" rating.
Risk tips: deterioration of market competition, raw material price fluctuations, exchange rate fluctuations, shop opening schedule is not as expected, sea freight fluctuations.