To bid for deputy capital, you need to ask questions:
There is a slight decline in revenue and pressure on the profit side. The revenue of 1-3Q23 company is 4.221 billion yuan /-2.29%, and the net profit is 514 million yuan /-24.08%. 23Q3's revenue is 1.146 billion yuan /-17.26%, and its net profit is 90 million yuan /-55.88%.
The gross profit margin and net profit margin declined in the first three quarters, and the sales expense rate was optimized compared with the same period last year. The gross profit margin of 1-3Q23 is 73.07%/-4.16pct, the net profit rate is 12.01%/-3.43pct, and the sales / management / R & D expense rate is 46.02%, 14.14%, 6.56%, respectively, compared with the same period last year-0.96pct/+1.41pct/+0.14pct.
23Q3 gross profit margin is 71.13%/-5.67pct, net profit margin is 7.46%/-7pct, gross profit margin and net profit margin fell sharply in the third quarter. The 23Q3 sales / management / R & D expense rates are 45.58% and 17.86%, respectively, compared with the same period last year-0.82pct/+3.73pct.
Share buyback demonstrates the company's confidence in development. On August 29, the company began to use its own funds to carry out share buybacks through centralized bidding transactions for employee stock ownership plans or equity incentives. The total amount of funds to be repurchased is 200-300 million yuan, and the repurchase price does not exceed 130 yuan per share. As of September 28, the company has bought back a total of 95456 shares, accounting for 0.0198% of the total share capital, with a total capital of 8.3882 million yuan.
The rate of sales expenses is continuously optimized, and R & D projects go hand in hand. The company reduces the sales expense rate of the skin care business in three aspects; 1) the product end: focus on large items and optimize the product structure; 2) the channel side: optimize the channel structure and increase the proportion of channels with lower sales expense rates such as Tmall. Increase the proportion of daily sales, self-broadcast and other sales methods, strengthen brand repurchase; 3) brand side: better achieve the mental occupation of consumers 4) Operation side: improve operation efficiency, ROI, data operation capability and so on. At the same time, the company carried out a number of important R & D projects in the first half of this year, covering medical polysaccharide biology and green biological manufacturing of medical proteins, based on synthetic biology. continue to promote innovation and technological upgrading to achieve high-quality industrial applications.
Profit forecast: considering the lower-than-expected performance of the company's functional skin care sector in the first three quarters, and the pressure on the gross profit margin of raw material products, we lowered our profit forecast for 2023-2025. It is estimated that the revenue will be 65.33pm 73.61 / 8.221 billion yuan (the previous value is 82.79pm 104.01 / 12.813 billion yuan), and the net profit of homing mother is 8.60cusp 9.70 / 1.112 billion yuan (the previous value is 13.17amp 16.76 / 2.114 billion yuan). We maintain the company's 2023 valuation at 50 times earnings, with a target price of $89.37 (previous value of $136.84) and a target market capitalization of $43.077 billion, maintaining a "buy" rating.
Risk hint: the industry competition aggravates the risk; the marketing expense investment is too high; the lack of live broadcast lead affects the income risk; the R & D progress is not as good as expected risk.