Joyoung(002242) 华兴证券·2024-09-25 08:20Investment Rating - The report maintains a "Buy" rating for Jiuyang Co., Ltd. with a target price of RMB 11.00, representing a potential upside of 19% from the current price of RMB 9.24 [1][4][5]. Core Insights - Jiuyang is facing a phase of developmental bottlenecks, testing its multi-category expansion capabilities as the domestic small kitchen appliance market matures. The expected revenue growth for 2024 is projected at 2.9% year-on-year, reaching RMB 9.9 billion [1][4][5]. - The report highlights that while the short-term profit margins are under pressure, the company is expected to maintain a net profit margin of 4.0% for 2024, with a slight increase in net profit by 1.6% to RMB 400 million [4][5]. Summary by Sections Revenue and Profit Forecast - Revenue for 2024 is expected to be RMB 9,896 million, with a growth of 2.9% year-on-year. The projections for 2025 and 2026 are RMB 10,378 million and RMB 10,879 million, respectively, indicating growth rates of 4.9% and 4.8% [6][9]. - The report anticipates a decline in net profit for 2024 to RMB 395 million, a decrease of 39.3% from previous estimates, with subsequent years showing recovery to RMB 447 million in 2025 and RMB 508 million in 2026 [5][6][9]. Market Conditions - The small kitchen appliance market is entering a mature phase, with online and offline retail sales declining by 5% and 12% respectively in the first half of 2024. This has led to intensified competition and a shift from volume growth to price declines [4][5]. - Jiuyang is adapting to the K-shaped consumption trend by innovating flagship products and expanding its price range to cater to different consumer segments, which is expected to stabilize domestic sales in the second half of 2024 [4][5]. Valuation Metrics - The report adjusts the target price down by 35% to RMB 11.00, corresponding to a P/E ratio of 19 times for 2025. The current valuation reflects a significant discount compared to peers, with Jiuyang's P/E for 2024 estimated at 17.9 times [5][8].