境外业务：增速恢复到合理区间，盈利能力表现亮眼。23 年，境外业务收入26.62 亿元，同比+13.44%；境外毛利率25.22%，同比+7.97pct。公司出口业务22 年年底与23Q1 均受到海外客户去库影响境外收入有所下滑，23Q2 起逐步恢复、Q3 已恢复至往期水平、高于22 年同期。Matters:
The company released its 2023 annual report and 2024 quarterly report: revenue of 2023 was 3.747 billion yuan, up 15.37% year on year; net profit to mother was 233 million yuan, up 120.12% year on year, after deducting net profit of 225 million yuan. 24Q1 revenue was 878 million yuan, up 24.42% year on year; net profit to mother was 56 million yuan, up 259.00% year on year; net profit after deducting non-return to mother was 54 million yuan, up 298.05% year on year.
Commentary:
Overseas business: The growth rate has returned to a reasonable range, and the profitability performance is impressive. In '23, overseas business revenue was 2,662 billion yuan, +13.44% year on year; overseas gross profit margin was 25.22%, +7.97pct year on year. The company's export business at the end of '22 and 23Q1 were affected by overseas customer departures, and overseas revenue declined. It gradually recovered from 23Q2, and Q3 has returned to previous levels, higher than the same period in '22.
Domestic business: The revenue scale exceeded the 1 billion mark, and the gross margin level increased dramatically. Domestic business revenue was 1,086 billion yuan, +20.40% year-on-year, accounting for 28.97%, and the domestic business share gradually approached 30%; domestic gross margin was 31.28%, +3.51 pct year on year. The results of Wanpy and Zeal brand control actions were remarkable.
The brand adjustment has basically been completed, and attention is being paid to the increase brought about by subsequent new products. After the price controls for the Zeal brand 23Q2 and Q3 were basically completed, there has been a slight increase since Q4; the wanpy brand streamlined SKU in the first three quarters of 23, and online and offline segmentation in 23Q4. After the adjustments are completed, it is expected that new product promotion actions that are more in line with the brand tone and more focused will be carried out one after another.
Investment advice: Provide stable profit margins abroad, and the brand side aims to accumulate and distribute money. The company's overseas business has returned to a steady growth range, which can provide a high-profit safety cushion for the company to expand the domestic market and develop the brand business; the brand side has been patiently polished to form a combo punch in various aspects such as marketing style, channel segmentation, and terminal price control, and 24 years will be worth looking forward to. Considering that overseas business still contributes to the company's main profit, and the exchange rate increase may be lower than 23 years, we adjusted the 24-25 EPS forecast to 0.92/1.34 yuan/share (the original forecast was 0.98/1.43 yuan/share), and introduced a 26-year forecast of 1.70 yuan/share. Referring to the DCF valuation, maintain the target price of 38 yuan/share, corresponding to 41.3 times PE in 24 years, and maintain the “recommended” rating.
Risk warning: competition in the domestic market intensifies, private brand expansion falls short of expectations, fluctuations in raw material prices, exchange rate fluctuations, changes in the international political and economic environment
