Core Viewpoint - Huaxing Capital reports that Zhenkunhang (ZKH.US) has met expectations for GMV in Q4 2024, with revenue and net profit exceeding forecasts, leading to a "Buy" rating and a target price of $4.50 per share [1][3]. Financial Performance - In Q4 2024, ZKH's total GMV was RMB 2.69 billion, with contributions from ZKH platform and GBB platform at approximately RMB 2.44 billion and RMB 255 million, respectively, showing year-on-year declines of 16.1%, 16.2%, and 14.9% [1]. - The non-GAAP operating loss for Q4 was RMB 19 million, with a net loss of RMB 15 million; operating profit margin (OPM) and net profit margin (NPM) were -0.8% and -0.6%, respectively, showing improvement from Q3 2024 due to a focus on high-margin businesses and cost control [2]. Business Expansion - ZKH currently has 412 SKUs in the U.S. market, with an additional 1,300 SKUs set to launch, covering areas such as PPE, hand tools, power tools, packaging materials, HVAC, and office supplies [2]. - The company aims to enhance customer growth, with over 1,500 registered users on its e-commerce site launched in December 2024 [2]. Supply Chain and Pricing Strategy - Approximately 20% of SKUs for the U.S. market can be sourced from outside China, including South Korea, Vietnam, and Malaysia, mitigating potential tariff impacts [2]. - Despite tariff considerations, ZKH's products maintain a significant price advantage in the U.S. market [2]. AI Development - ZKH has integrated 2 million material items with an accuracy rate exceeding 90%, aiming to improve material management efficiency for customers [3]. - The internal AI assistant enhances order processing efficiency by approximately 23% [3]. Future Projections - Huaxing Capital adjusts ZKH's Q1 2025 GMV growth forecast to -10.1% and full-year growth to +7.0%, with revenue forecasts of -0.8% for Q1 and +11.1% for the full year [3]. - Expected gross margins for Q1 and full year 2025 are 17.9% and 18.2%, respectively, with non-GAAP net profit margins projected at -3.0% for Q1 and +0.4% for the full year [3]. - ZKH is anticipated to achieve positive GMV and revenue growth in Q2 2025, with net profit expected in the second half of 2025 [3].
华兴资本：预计2025年营收与净利润同比转正 重申震坤行(ZKH.US)4.50美元目标价