Incident: The company released a performance forecast. It is expected that the net profit of returning to the mother in 2022 will fall 84%-89% year on year. The company released the 2022 performance forecast: it is expected to achieve net profit of 20 million yuan to 30 million yuan in 2022 (down 84.00%-89.33% year on year). In 2022 Q4 alone, it is expected to achieve a net profit of 2.48 million yuan to 12.48 million yuan (down 57.34%-91.54% year on year) due to the impact of the epidemic. Considering the impact of the 202Q4 epidemic, we lowered our 2022 profit forecast. The company's net profit for 2022-2024 is estimated to be 0.24 (-0.34) /185/286 million yuan, the corresponding EPS is 0.05 (-0.08) /0.42/0.65 yuan, and the current stock price corresponding to PE is 506.7/66.5/43.0 times. We believe that the company has now built a pan-fashionable ecosystem for the collaborative development of the three major businesses. The womenswear and baby businesses are steady, and the medical and aesthetic business is expected to contribute incrementally, with reasonable valuations and maintaining a “buy” rating.
Revenue is under pressure in the context of repeated epidemics. New and sub-new institutions affect profitability in terms of revenue. It is expected that due to repeated epidemics and epidemic prevention policies, some of the company's clothing stores and medical and aesthetic institutions will face challenges such as reduced passenger flow and temporary closure, and the revenue side will be under pressure. In terms of profitability, there are many new institutions and sub-new institutions under the company's medical and aesthetic business that are still in the incubation period. We expect that institutional promotions will be strong during the incubation period, which will have a certain impact on gross margin. In terms of expenses, since the company opened a number of new women's clothing stores and medical and aesthetic institutions in 2021, sales expenses and management expenses are expected to increase significantly in 2022 over the same period last year. The above three factors combined to cause the company's net profit to the mother in 2022 to fall sharply year on year.
Two-wheel drive accelerates national expansion and layout, and the “scale+brand” effect strengthens comprehensive competitiveness. Currently, epidemic prevention and control has entered a new stage. The recovery of medical and aesthetic consumption in 2023 is highly certain. For the company:
On the one hand, the operation of internal institutions will resume relatively quickly, and the maturing of new institutions and sub-new institutions is also expected to contribute to the increase; on the other hand, in vitro incubators may accelerate their maturity, thereby further increasing the number of potential mergers and acquisitions and advancing the process of outreach mergers and acquisitions. We believe that the company is a leading regional medical and aesthetic institution. It has high-quality medical and aesthetic resources and an efficient management model. The “endogenous+extension” dual-wheel drive helps steady expansion. It is expected to accelerate the nationalization layout in the future and strengthen its overall competitiveness through the “scale+brand” effect.
Risk warning: store expansion falls short of expectations, loss of human resources, increased competition, medical accidents, repeated epidemics.