CBEST(600729) Soochow Securities·2024-07-11 07:00Investment Rating - The investment rating for Chongqing Department Store (600729) is "Buy" (maintained) [1][10]. Core Views - The company reported a revenue of 4.13 billion yuan for Q2 2024, a year-on-year decrease of 18.5%, and a net profit attributable to shareholders of 280 million yuan, down 28.9% year-on-year. The non-recurring net profit was 260 million yuan, down 26.5% year-on-year. The contribution from the consumer finance segment is estimated to be around 160 million yuan, a decrease of 31% year-on-year [1][8]. - The report emphasizes the potential for profit margin improvement through supply chain transformation and operational efficiency enhancements. The company's initiatives in retail, such as "six major stores" and "hard discount stores," are expected to open up revenue growth opportunities. Further adjustments in governance and operations may help offset industry demand pressures [2][10]. Financial Summary - For 2024, the company is projected to have total revenue of 16.98 billion yuan, a decrease of 10.59% year-on-year, with a net profit of 1.33 billion yuan, an increase of 1.20% year-on-year. The earnings per share (EPS) is expected to be 2.97 yuan [8][10]. - The financial forecast indicates a decline in net profit estimates for 2024-2026, revised from 1.45 billion yuan, 1.59 billion yuan, and 1.71 billion yuan to 1.33 billion yuan, 1.40 billion yuan, and 1.47 billion yuan respectively [10]. - The company's price-to-earnings (P/E) ratio is projected to be 7, 6, and 6 times for 2024, 2025, and 2026 respectively, indicating a low valuation compared to historical averages [10]. Market Data - The company has a net asset value per share of 16.03 yuan and a debt-to-asset ratio of 62.48% [4]. - The total market capitalization is approximately 8.69 billion yuan, with a circulating A-share market value of about 3.76 billion yuan [18]. Performance Analysis - The report notes that the decline in performance for Q2 2024 is primarily due to a high base from the previous year and fluctuations in non-recurring gains. The consumer finance segment has also seen increased provisioning, impacting overall profitability [9]. - The company's main business non-recurring net profit for Q2 2024 is estimated at 940 million yuan, down 16.4% year-on-year, indicating challenges in maintaining growth amidst a tough consumer environment [1][9].