Investment Rating - The report maintains a "Buy" rating for Wancheng Group (300972) [1] Core Views - The company is expected to achieve revenue of 10.8-11.2 billion yuan in the first half of 2024, with the bulk coming from the snack business [1] - The snack business is showing strong sequential growth, with Q2 2024 revenue projected to be 5.8-6.3 billion yuan, reflecting a quarter-on-quarter increase of 23.5%-34.2% [1] - The net profit margin for the snack business (excluding equity payment expenses) is expected to be 2.63%-2.80%, indicating an improvement from Q1 2024 [1] - The company has a cash position of 2.1 billion yuan as of the first half of 2024, up from approximately 1.7 billion yuan in Q1 2024, demonstrating robust cash flow from the snack business [1] - The report highlights that concerns regarding industry competition affecting profitability are alleviated by the sequential increase in profit margins for the snack business [1] - The apparent net profit for the first half of 2024 is slightly positive, primarily impacted by equity incentive expenses and a significant drop in the sales price of the mushroom business [1] - Future projections estimate snack business revenue at 25 billion yuan for 2024, with a net profit contribution of 1.5-2 billion yuan after excluding equity incentive expenses [1] Financial Summary - Total revenue is projected to grow from 9.294 billion yuan in 2023 to 25.564 billion yuan in 2024, reflecting a year-on-year growth rate of 175.1% [11] - The net profit attributable to the parent company is expected to recover from a loss of 83 million yuan in 2023 to a profit of 127 million yuan in 2024 [11] - The gross margin is projected to stabilize around 10.1% in 2024, with a return on equity (ROE) forecasted at 12.9% [11] - Earnings per share (EPS) are expected to increase from -0.47 yuan in 2023 to 0.72 yuan in 2024 [11]
万辰集团：收入验证成长，盈利持续向上