Incident Overview

The company released its three-quarter report in '23:

23Q1-Q3: Total operating income of 4.431 billion yuan (YOY +4.03%), net profit of 360 million yuan (YOY +28.16%), net profit of net income of 346 million yuan (YOY +31.25%) after deduction of net profit of 346 million yuan (YOY +31.25%).

23Q3: Total operating income is 1,551 billion yuan (YOY +6.56%), net profit of 99 million yuan (YOY +151.55%), net profit of 100 million yuan (YOY +184.72%) after deducting non-return net profit of 100 million yuan (YOY +184.72%).

Analytical judgment

Revenue side: Advanced strategies are promoted, and the company's revenue performance is outperforming the market. According to Ovi data, the sales growth rate of online range hoods/gas stoves under the Q3 Vantage brand was 7%/8%, respectively, and the industry as a whole was 0%/-2%.

Profit side: 23Q1-Q3 achieved gross profit margin of 41.79% (YOY+0.57pct), net profit margin of 8.12% (YOY+1.53pct); corresponding to Q3 sales margin of 42.61% (YOY+2.55pct), net profit margin of 6.36% (YOY+3.66pct).

The positive factors for the Q3 increase in net interest rate of return include: 1) the promotion of high-end strategies, the increase in average product prices, the decline in raw material prices, and the increase in gross margin; 2) prudent cost investment, and a marked decline in the Q3 sales expense ratio and R&D expense ratio. The negative factors were mainly due to a total impairment loss of 43 million yuan in Q3, and the negative impact was on the net interest rate of 3.7 pct.

What are the sales/management/ R&D expense rates for 23Q1-Q3 companies

24.01%/4.66%/3.95%, year-on-year -1.69pct/+0.51pct/-0.84pct, respectively; corresponding Q3 was 25.37%/4.86%/3.53%, respectively, year-on-year -4.02pct/+0.38pct/-1.63 pct.

Investment advice

Based on the information in the three-quarter report, we maintain the company's revenue forecast for 23-25 at 64.32/70.37/7.708 billion yuan, +10.54%/+9.41%/+9.54% year-on-year respectively.

In terms of gross margin, it is expected to be 40.52%/41.02%/41.02% in 23-25, respectively. Net profit for the corresponding years 23-25 was 4.96/5.62/638 million yuan (previous value was 550/630/714 million yuan), respectively, compared with the previous year

+246.54%/+13.36%/+13.51%, the corresponding EPS was 0.58/0.66/0.75 yuan (previous value was 0.65/0.74/0.84 yuan), calculated at the closing price of 5.97 yuan on November 02, 23, and the corresponding PE was 10.21/9.00/7.93 times, respectively, maintaining the “increased holdings” rating.

Risk warning

Real estate recovery fell short of expectations; channel reforms fell short of expectations; and market competition intensified.