According to the Financial Intelligence APP, CICC released a research report stating that it maintains a "outperform industry" rating for TuHu-W (09690) with a target price of HK$24.5. The company announced 1H24 results: achieved revenue of 7.126 billion yuan, +9.3% year-on-year, +0.7% quarter-on-quarter; net profit attributable to equity holders was 0.284 billion yuan, +378% year-on-year; adjusted net profit was 0.358 billion yuan, +67.3% year-on-year, +34% quarter-on-quarter. The 1H24 performance meets the bank's expectations.

The bank mentioned that TuHu's internal structure and cost control have been continuously optimized, leading to a significant increase in net margin. The gross margin for 1H24 was 25.9%, +1.7ppt year-on-year; net margin for 1H24 was 4%, +3.1ppt year-on-year, with the improvement in profitability mainly due to the company's enhanced pricing negotiation capabilities upstream, combined with sales structure optimization, and the increase in the proportion of revenue from dedicated and self-owned products, auto maintenance services, etc. The total operating expense ratio for 1H24 was 23.6%, -0.9ppt year-on-year, with all expenses continuously diluted year-on-year. TuHu's integrated online and offline business model has accumulated a strong foundation, continuously advancing quality improvement and efficiency enhancement measures. The sales and management expense ratios for 1H24 have decreased year-on-year to 12.7% and 2.6%, respectively. The bank believes that the proportion of dedicated and self-owned products is expected to continue to increase, coupled with ongoing management quality improvement and efficiency enhancement initiatives, indicating a significant room for improvement in profitability.

Additionally, as of June 30, 2024, the company had nearly 7.1 billion yuan in cash on hand, with a relatively high level of financial security. In March 2024, the company announced a stock repurchase plan in response to stock price fluctuations. According to the company's interim report, as of 1H24, approximately 12.29 million Class A shares were repurchased, with a total repurchase amount of 0.204 billion Hong Kong dollars, and the repurchased shares were cancelled in early June. In June 2024, the company announced a second buyback plan to enhance the flexibility of the compensation system, avoiding dilution of the existing share capital due to stock-based incentive plans, demonstrating the company's high level of attention to the interests of shareholders. The bank believes that the company's future cash support for buybacks is adequate, emphasizing a healthy foundation for shareholder and employee interests.