投资建议：维 持“增持”评级。考虑需求恢复偏弱及公司新厂投产后配套费用加大，下调2024-2026 年公司EPS 预测至0.73(-0.28)、0.83(-0.36)、0.95(-0.44)元，参考可比公司考虑需求复苏后公司改善弹性较大，且C 端为主、价格随行就市的业务模式盈利改善幅度有望相对可比公司较明显，给予24 年32X PE，下调目标价至23.5 元。Introduction to this report:
The sales price of the company's products affected revenue as the cost was lowered. The commissioning of the new plant brought about an increase in fixed depreciation and amortization costs, and profits fluctuated in the short term. The company actively promoted store upgrading and expansion of category development scenarios, and expected a gradual recovery in demand.
Key points of investment:
Investment advice: Maintain an “Overweight” rating. Considering the weak recovery in demand and the increase in supporting costs after the company's new plant is put into operation, the 2024-2026 EPS forecast was lowered to 0.73 (-0.28), 0.83 (-0.36), 0.95 (-0.44) yuan. Refer to the comparable company considering that after demand recovery, the profit improvement of the company's business model, which is mainly on the C-side and the market follows the market, is expected to be relatively obvious. With 32X PE in '24, the target price will be lowered to 23.5 yuan.
Performance fell short of expectations. The company's 2024H1 revenue was 0.327 billion yuan, -21.53% YoY, net profit to mother 0.042 billion yuan, 43.37% YoY, minus non-net profit 0.041 billion yuan, 43.10% YoY; 2024Q2 single quarter revenue 0.161 billion yuan, YoY -24.94%, net profit to mother 0.023 billion yuan, -40.12% YoY, minus non-net profit 0.023 billion yuan, 40.12% YoY.
Revenue from various categories and channels is under pressure in the short term and is expected to be significantly affected by falling prices. By product, 2024Q2 revenue from beef/poultry/pork/mutton/fish/shrimp/other categories was -27.4%/-13.8%/-76.6%/-29.8%/-23.4%/-25.3%, respectively. It is expected to be mainly affected by declining prices and a slight drop in sales. Among them, beef and lamb costs are low and tonnage prices are still showing year-on-year declines. Demand for high-value lamb products is under pressure, and pork prices have rebounded slightly, driving the decline in pork product revenue to narrow and narrow. The gross margin of 2024Q2 was -1.3 pct to 24.7% year on year. It is expected that the company will adjust product prices based on procurement costs. Overall, it will maintain an appropriate gross profit margin, and there will be no significant increase in price competition. Looking at the short term, the current price of pork and beef has rebounded, which is conducive to a recovery in the sales price and gross margin of the company's products.
New factory sharing suppresses profits, promotes store upgrades, and looks forward to the restoration of the demand environment. By channel, 2024Q2 franchise/dealer/supermarket/wholesale/direct sales/e-commerce customer channel revenue was -24.9%/-7.9%/-26.2%/-95.4%/-27.0%, respectively. The number of 2024Q2 franchisees was reduced by 76, a net decrease of 38. The expansion of stores and the recovery in store efficiency still need to be improved. The company promoted the upgrading of franchise stores in model markets such as Wuxi, expanded product categories, optimized doorstep displays, and began to use Douyin Live to pick up or distribute goods nearby. Single store sales may gradually improve. The 2024Q2 sales/management/R&D/finance rates were flat, +3.0 pct/flat, and -0.9 pct, respectively. It is expected that starting in Q2, sales staff will optimize and return to the original team size. At the same time, business commission expenses will decrease, and management rates will still rise due to the sharing of new plants. Subsequent rents from old factories are expected to save rent. We expect a gradual boost in performance due to the recovery in demand and the company's upgrading of stores.
Risk warning: macroeconomic fluctuations, increased market competition, and fluctuations in costs and expenses.