The company publishes annual reports and quarterly reports

The 24Q1 company's revenue of 900 million increased 23%, to the mother of $0.7 billion, the same increase of 103%, and the same increase of 121%; 23A revenue of 3.1 billion yuan, up 13%, the same increase of 120 million, the same increase of 146%, and after deduction of 140 million, the same increase of 587%; of these, the revenue of 23Q4 of 800 million increased by 41%, to the mother of -06 million, after deduction of 0.01 billion.

In 2023, the company's OEM customers faced global economic and consumer pressure, were in the inventory digestion stage, and procurement of suppliers slowed down. Relying on global advantages and advanced manufacturing capabilities, the company actively expands OEM in the clothing category while consolidating its competitive advantage in the luggage category, accelerates the increase in the share of new and old customers, and bucked the trend to achieve impressive growth performance in the industry.

The company's brand management business focuses on the “Xiaomi” and “90 points” brands, focusing on travel products such as trolley cases and bags. Benefiting from the rapid release of terminal travel demand in the domestic market, it has actively launched new products and formed a differentiated product matrix through various channels, and its business performance has improved markedly.

On the one hand, the 23-year performance growth expanded the advantages of overseas layout on the OEM side, consolidated cooperation with high-quality customers, optimized customer structure and order structure, and effectively increased gross margin level and supply chain side production efficiency; on the other hand, the brand drastically turned losses into profits, seized the recovery in domestic travel consumption, strengthened brand positioning based on user consumption trend insight, new products, and refined channel operation, and focused on operational results.

In the 23s, labor revenue was 2.4 billion yuan, with a gross profit margin of 24%, and an increase of 2 pcts; of these, luggage OEM was 2 billion, an increase of 2.59%; garment OEM was 410 million, an increase of 71%.

The company's OEM business adheres to the strategy of deepening high-quality brand customers and continues to promote lean management and digital informatization. On the one hand, it continues to consolidate its competitive advantage in luggage manufacturing. The order size and market position have bucked the trend, steadily increased its share among old customers such as Nike, Decathlon, VF Group, Dell, HP, and Asus, and expanded into a bag supplier for new customers such as Uniqlo, JR286, and YETI. On the other hand, deepen partnerships with apparel customers such as Adidas, Puma, and Muji, and continuously expand revenue growth in the textile, garment and fabric sector

Relying on the advantages of the global production capacity layout of Indonesia, Chuzhou, China, and India, the company continuously improves product design, development and manufacturing capabilities, increases automation and digital investment, and launches SAP and other systems in overseas factories to create a high standard order delivery level and delivery quality.

In '23, the brand's operating revenue was 630 million, an increase of 22%; the gross profit margin was 27%, the same increase of 6pct; of this, the online margin was 210 million, the same increase was -6%, the gross profit margin was 34%, and the same increase was 12pct; distribution was 400 million, the same increase of 44%, and the gross profit margin was 23%, the same increase of 2 pcts.

The decline in online revenue was due to the company's focus on core categories, optimizing channel layout, and reducing some sports and travel accessories products sold online during the same period last year; the increase in online gross margin was due to a focus on core categories and higher gross margin sales of new products;

The increase in distribution revenue is due to the recovery of the domestic travel market and the increase in sales revenue from distribution channels, mainly in the travel luggage category. The increase in gross margin of distribution is due to the higher gross margin of new products and the implementation of scientific and effective pricing mechanisms in terminal sales channels.

The company's brand management seizes the development opportunities of the domestic travel consumer market and the booming trend of cultural tourism development in various regions, focusing on the travel trolley case and backpack categories, reconstructing the brand promotion system, organizing product lines, quickly introducing new products, and quickly seizing market share by relying on brand strength and product strength.

The company fully combines the user profiles and attributes of each sales channel to form a differentiated product matrix and refined channel operation model, focusing on operational results. Improve organizational effectiveness and quality of development through capacity building and continuous strengthening of core development elements such as product power, brand power, and channel power.

The manufacturing business is outside supply and demand, and rivet customers are major rivets

The company's manufacturing side demand and supply come mainly from the world, not restricted by a single country or region. It focuses on luggage and clothing categories, anchors the “big customer” strategy, maintains good cooperation with world-renowned sports and leisure brands such as Nike, Adidas, Decathlon, VF Group, Puma, Uniqlo, etc., and continues to increase the order share of new and old customers based on the differentiated global production capacity layout of Indonesia, China and India. At the same time, we will strengthen the competitive advantage of supply chain costs through digital upgrading and lean management, and continue to consolidate and enhance the competitive advantage of the industry.

2024 Increase the exposure of private brands and go overseas

The private brand side will continue to consolidate and enhance its competitive advantage in the core battlefield of trolley cases, deepen innovation in new functions and materials, increase investment in the bag market, launch popular categories that can be opened in multiple scenarios, and increase the contribution to backpack sales. Through various promotion methods such as brand co-branding and content marketing, we shape brand awareness with high recognition, strong memory, and strengthen consumers' mentality.

At the same time, the company will explore its own brands overseas and extend its reach to a broad range of overseas markets. As the brand itself continues to develop and expand, the company will continue to focus on promoting technological innovation and industrial chain collaboration to truly help Chinese luggage brands and the luggage industry reach a higher level and stand on the world stage.

Raise profit forecasts and maintain “buy” ratings

The company started with IT bag OEM manufacturing in 2005, and its products gradually expanded to the field of sports and leisure bags. In 2015, it entered the Xiaomi ecosystem to develop B2C business. In 2019, it acquired Nike's core supplier and entered the Nike supply chain system, extending its production base to Indonesia and actively expanding production capacity. Over a period of five years, Indonesia's output value increased 8 times, building and consolidating the core competitiveness of leading sports customers in the world.

The implementation of key actions based on long-term strategic deployment helped the company to overtake curves and rapidly grow into a leader in the luggage industry as a latecomer in the industry. The company's 24Q1 performance exceeded expectations, net profit reached a record high, and net interest rate increased significantly by about 3.4 pct. Relying on its advantages in global layout and advanced manufacturing capabilities, the company actively expands the garment industry while consolidating its competitive advantage in the luggage category, accelerates the increase in the share of new and old customers, and bucked the trend to achieve impressive growth performance in the industry.

The brand management business focuses on the “Xiaomi” and “90 point” brands, focusing on travel products such as trolley cases and bags. Benefiting from the rapid release of terminal travel demand in the domestic market, the company actively launched new products and formed a differentiated product matrix through various channels, and business performance improved significantly. Therefore, we raised our profit forecast. The net profit for 24-26 is estimated to be 2.9/3.6/450 million yuan, respectively (24-25 years ago, the value was 2.32 billion 285 million yuan), EPS was 1.22/1.52/1.90 yuan/share, respectively, corresponding to PE 19/15/12X, respectively.

Risk warning: the risk of high customer concentration; the risk of fluctuating raw material prices and rising labor costs; the risk of control risks caused by the expansion of business scale; the risk of exchange rate fluctuations, etc.