The company published its 24-year semi-annual report. The company achieved revenue of 4.387 billion yuan, 1.60% YoY, and net profit to mother 0.175 billion yuan, or -29.04% YoY. Of these, 24Q2 achieved revenue of 2.321 billion yuan, or -4.29% year-on-year, and realized net profit of 0.045 billion yuan, or -63.88% year-on-year.

The internal increase and external decline, and the food processing machine performed brilliantly. By region, the company's domestic sales increased by 5% and export sales declined by 10%; by product, the company's food processing machine products increased by 14%, nutritional cookers increased by 5%, and Western-style appliances fell 10%.

Profitability recovered month-on-month. The rapid growth of food processing machine products led to an increase in gross margin. The company's 24Q2 gross margin was 2.64 to 29.10% year on year, sales/management/R&D expenses changed by 3.36pp/-0.37pp/0.66pp to 19.18%/3.28%/4.26%, respectively, and 24Q2 net profit margin was -3.23pp to 1.96% year over year.

Profit forecasting and investment advice. In the long run, we are optimistic about the growth and scalability of the small household appliance industry. The company is gradually transforming from soy milk machines to high-quality small household appliances, and we look forward to the joint development of multiple categories of the company. We expect the company to achieve net profit of 0.369 billion yuan in 2024, giving the company a PE valuation of 18-20 times in 2024, corresponding to a reasonable value range of 8.64-9.6 yuan, maintaining the “superior to the market” rating.

Risk warning. Competition in the industry intensifies, and overseas demand fluctuates.