首次覆盖给予“增持”评级。外部经营扰动趋微，公司家居品类转型成效渐现，未来在渠道多元及供应链贯通有望对业务扩张形成合力，规模前景可期。我们预计2024-2026 年公司归母净利润5.00/6.56/8.15 亿元，同比-6%/+31%/+24%。参考可比公司，结合PE/PB 估值，给予公司目标价18.2 港元，首次覆盖给予“增持”评级。Introduction to this report:
The transformation is progressing in an orderly manner, leading weather is beginning to take shape, and operations have reached the next level. The market is vast and promising.
Key points of investment:
The first coverage gives an “gain” rating. External business disruptions are fading, and the company's transformation in the home furnishing category is gradually showing results. Diversified channels and supply chain penetration are expected to form a synergy for business expansion in the future, and the scale prospects are promising. We expect the company's net profit to be 0.5/0.656/0.815 billion in 2024-2026, or -6%/+31%/+24% YoY. Referring to comparable companies, combined with the PE/PB valuation, the company was given a target price of HK$18.2, which was covered for the first time to give an “increase in wealth” rating.
Industry: Cross-border home e-commerce is on the rise, and China's supply chain is profoundly benefiting. According to Frost & Sullivan, the global online furniture and home furnishing category sales volume is expected to reach 779.4 billion US dollars in 2028, with a CAGR of 16.6% in 2023-2028, which is higher than the overall growth rate of global cross-border e-commerce. In the past, sales scenarios for major categories were mainly offline, there was a large online space, and supply chain infrastructure for medium and large products such as overseas warehouses exploded, accelerating the penetration of online channels. At the same time, China has accumulated sufficient manufacturing experience in the past international division of labor, and industrial clusters have given Chinese manufacturers an international comparative advantage in multiple dimensions such as cost, delivery, and quality control.
Strategic restructuring: focus on the dominant categories of home furnishings, and consolidate the business quality through diversified channel expansion. After the Amazon incident, the company sharply changed its business strategy, actively reduced the scale of the power tools and consumer electronics business, and focused on household categories with deep advantages in the Chinese supply chain. Thanks to forward-looking strategic transformation and the accumulation of operating capabilities in the past, the company quickly entered the first tier of cross-border e-commerce. According to Frost & Sullivan, according to the 2023 GMV calculation, Aoji Co., Ltd. ranked first in the B2C overseas e-commerce market for furniture and home furnishings based on Chinese sellers. Furthermore, while maintaining Amazon's basic market, the company is actively expanding emerging online furniture sales channels such as Wayfair and Walmart to maximize the reach of visitors while improving operational stability.
Competitive advantage: Efficient R&D operation ensures sales efficiency, and supply chain integration enhances business value.
The company has cooperated with 575 manufacturing partners to effectively respond to changing market needs on the production side. At the same time, the company is deeply involved in R&D and design to ensure the “explosion” ability of products. According to Frost & Sullivan, the company's average return rate on all third-party e-commerce platforms in 2023 was less than 3.5%, which is within the lowest level in the industry. The subsidiary Shenzhen Xiyou Zhicang is ranked first among all B2C export e-commerce logistics solution providers focusing on medium to large products.
Risk warning: The international trade environment deteriorates, industry competition intensifies, costs continue to rise, etc.
