调整盈利预期 ，维持“增持”评级。公司业绩略低于我们的预期，考虑当前行业及公司经营趋势，我们下调盈利预期，预计公司2024-2026 年EPS 为1.78/2.06/2.37 元（原值1.92/2.22/2.56 元），参考行业估值水平，给予公司2024 年22.2xPE，上调目标价至39.44 元，维持“增持”评级。Introduction to this report:
The external environment is under pressure, the company's global production capacity is progressing steadily, business boundaries are expanding in an orderly manner, and performance is growing against the trend.
Key points of investment:
Adjust profit expectations and maintain an “gain” rating. The company's performance was slightly lower than our expectations. Considering the current industry and company business trends, we lowered our profit expectations. The company's 2024-2026 EPS is 1.78/2.06/2.37 yuan (original value 1.92/2.22/2.56 yuan). Referring to the industry valuation level, the company will be given 22.2xPE in 2024, raised the target price to 39.44 yuan, and maintain the “gain” rating.
Business boundaries expanded, and revenue grew steadily. The growth rate of major categories such as consumer electronics, cigarette packs, and wine bags is expected to remain around 10% in the first three quarters of 2024, and the growth rate of environmentally friendly products is significantly higher than the company average. Consumer electronics customers are mainly mature brand companies. The scale is growing steadily, and the company's order share is steadily increasing. Eco-friendly packaging benefits from the boom in the alternative plastic products industry, and the company focuses on developing products to develop customers to seize industrial opportunities. Subsidiaries Renhe Intelligence and Huabaoli Electronics have completed construction of their Vietnamese factories, and order delivery is still in progress. The company is empowering them to develop new customer groups and improve the order structure.
Cost reduction and efficiency were implemented, and profits remained stable. 2024Q3 company sales gross margin/net profit margin 27.6%/13.0%, -0.5pct/+0.1pct, month-on-month +2.6pct/+5.8pct; 2024Q3 sales/management/R&D/finance expense ratio 2.7%/5.4%/3.8%/0.1%, +0.3pct/-0.3pct/-0.8pct/-0.6pct year over year. The month-on-month improvement in gross margin was mainly due to an increase in capacity utilization during the peak season and a slight decrease over the previous year, mainly due to exchange rate effects. The reduction in R&D cost rates is mainly due to cost reduction and efficiency. Furthermore, the company controls exchange rate exposure through strategies such as hedging, and it is expected that 2024Q3 exchange rate changes will have little impact on operating profits.
International customers are expanding faster, and high dividends focus on shareholder returns. The company has 50+ production bases and 5 service centers in 10 countries around the world. The Philippines and Mexico plants opened in July and September 2024 respectively, helping the company significantly shorten production and transportation time and respond quickly to global market demand. Currently, overseas production accounts for about 20%. In the future, we will focus on serving international customers. Through expansion into new regions such as Europe, the target share will reach 40% +. Currently, the company's global production capacity layout is basically complete, and the future will focus on capital efficiency and shareholder returns. In 2023, the company's dividend was 0.87 billion, with a cash dividend ratio of 60.3% and a dividend rate of 3.4%; in 2024, a new round of repurchases (0.1-0.2 billion) was implemented. Assuming that the dividend ratio remains unchanged, the estimated dividend rate is about 5%.
Risk warning: Prices of raw materials continue to rise, downstream consumer demand falls short of expectations, etc.