SHUANGHUI(000895) 华创证券·2024-08-14 02:38Investment Rating - The report maintains a "Strong Buy" rating for Shuanghui Development with a target price of 28 CNY [1] Core Views - Shuanghui Development's H1 2024 revenue decreased by 9.34% YoY to 27.67 billion CNY, with net profit attributable to shareholders dropping by 19.05% YoY to 2.3 billion CNY [1] - The company plans to distribute a dividend of 6.6 CNY per 10 shares, totaling 2.29 billion CNY, with a payout ratio of 99.58% and a semi-annual dividend yield of 2.80% [1] Business Performance Meat Products Business - Q2 2024 meat products revenue decreased by 15.2% YoY to 5.58 billion CNY, with sales volume and unit price down by 14.2% and 1.2% respectively [1] - Despite cost reductions, the meat products business saw a 4.6% YoY decline in operating profit to 1.44 billion CNY, with an operating margin increase of 2.9 percentage points to 25.8% [1] Slaughtering and Other Businesses - Q2 2024 slaughtering revenue decreased by 15.8% YoY to 6.73 billion CNY, with sales volume and unit price down by 9.0% and 7.4% respectively [1] - The slaughtering business achieved an operating profit of 156 million CNY, up 7.9% YoY, with an operating margin increase of 0.5 percentage points to 2.3% [1] - Other businesses, mainly farming, reported a loss of 169 million CNY in Q2 2024, with pig farming reducing losses but poultry farming increasing losses [1] Future Outlook - The meat products business is expected to stabilize through refined operations, new channel layouts, and increased market investment [1] - The slaughtering business is anticipated to benefit from increased frozen meat contributions in H2 2024, while farming is expected to reduce losses and potentially turn profitable next year [1] Financial Forecasts - Adjusted EPS forecasts for 2024-2026 are 1.40, 1.51, and 1.59 CNY respectively, down from previous estimates of 1.58, 1.68, and 1.76 CNY [1] - The current 2024 PE ratio is 17x, with a target PE of 20x for 2024, supporting the target price of 28 CNY [1] Key Financial Metrics - 2024E revenue is projected at 56.95 billion CNY, a 4.9% YoY decrease, with net profit attributable to shareholders at 4.84 billion CNY, down 4.2% YoY [1] - The company's current dividend yield stands at 6.2%, which is considered attractive [1]