lolo(000848) Huaxin Securities·2024-10-29 05:30Investment Rating - The report maintains a "Buy" investment rating for the company [1][2]. Core Views - The company has shown slight pressure on revenue growth, but significant improvement in costs. The total revenue for Q1-Q3 2024 reached 21.59 billion yuan, reflecting a year-on-year increase of 6.10%. However, the net profit attributable to the parent company decreased by 5.49% to 4.19 billion yuan [1]. - The gross profit margin improved year-on-year due to cost improvements, while the sales expense ratio increased significantly. The gross and net profit margins for Q3 2024 were 40.68% and 23.92%, respectively, showing year-on-year increases of 3.22 and 0.13 percentage points [1]. - The company is actively expanding its market presence, with the launch of the Lululemon beverage project and a share buyback plan to boost investor confidence [1]. Financial Summary - The company’s revenue for 2023 is projected at 29.55 billion yuan, with a growth rate of 9.8%. For 2024, the revenue is expected to be 30.89 billion yuan, reflecting a growth rate of 4.6% [4]. - The net profit attributable to the parent company for 2023 is estimated at 638 million yuan, with a slight decrease to 619 million yuan in 2024, indicating a -3.0% growth rate [4]. - The diluted earnings per share (EPS) for 2024 is adjusted to 0.59 yuan, with projections of 0.64 yuan and 0.72 yuan for 2025 and 2026, respectively [4][5]. Operational Insights - The company has made solid progress in capacity expansion, with the Lululemon beverage project expected to commence production in November 2024. The project aims for an annual output of 500,000 tons of Lululemon beverages [1]. - The company announced a share buyback plan on October 25, 2024, intending to repurchase 30-60 million shares, which represents 2.85%-5.70% of the total share capital, to reduce registered capital [1]. Cash Flow and Financial Health - The net cash flow from operating activities for Q1-Q3 2024 was 1.01 billion yuan, with a significant year-on-year increase of 142.56% in Q3 [1]. - The company’s total assets are projected to grow from 41.81 billion yuan in 2023 to 51.72 billion yuan by 2026, indicating a healthy growth trajectory [5].