KinLong(002791) 东吴证券·2024-11-01 19:00Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The company reported a revenue of 4.91 billion yuan for the first three quarters of 2024, a year-on-year decrease of 11.51%, with a net profit attributable to the parent company of 33 million yuan, down 77.22% year-on-year. In Q3 alone, revenue was 1.7 billion yuan, a decline of 22.46% year-on-year, and net profit was 28 million yuan, down 78.71% year-on-year [2] - The revenue decline in Q3 is attributed to increased pressure from the real estate completion demand, with significant declines expected in categories closely related to real estate, such as door and window hardware. However, the company is actively developing new scenarios and markets, which is expected to maintain an upward trend in market share. The overseas market continues to show good growth, with a cumulative increase of approximately 18% in overseas revenue from self-operated channels [2] - The gross margin remained stable at 31.3% for the first three quarters of 2024, with a slight decline in Q3 gross margin to 31.37%. The increase in expense ratio is notable due to the significant revenue decline, with a 9% decrease in domestic sales personnel since the beginning of the year [3] - The operating cash flow has improved, with a net cash flow from operating activities of 11 million yuan for the first three quarters of 2024, compared to a net outflow of 98 million yuan in the same period last year [3] - The profit forecast for the company has been adjusted downwards for 2024-2026, with net profit estimates of 106 million yuan, 272 million yuan, and 415 million yuan respectively. The price-to-earnings ratio at the closing price on October 31 corresponds to 99X, 39X, and 25X for the respective years [4] Summary by Sections Financial Performance - Total revenue for 2022 was 7.648 billion yuan, with a year-on-year decrease of 13.16%. In 2023, revenue increased slightly to 7.802 billion yuan, a growth of 2%. However, the forecast for 2024 is a decline to 6.795 billion yuan, a decrease of 12.90% [1][4] - The net profit attributable to the parent company was 656 million yuan in 2022, which saw a significant drop to 324 million yuan in 2023, and is expected to further decline to 106 million yuan in 2024, a decrease of 67.16% [1][4] - The latest diluted EPS is projected to be 0.30 yuan per share for 2024, with a P/E ratio of 98.71 [1][4] Market Data - The closing price of the stock is 29.68 yuan, with a market capitalization of approximately 10.5 billion yuan [6] - The company has a price-to-book ratio of 1.84 and a total circulating A-share market value of approximately 4.88 billion yuan [6] Cash Flow and Valuation Metrics - The operating cash flow for 2023 is reported at 499 million yuan, with projections of 735 million yuan for 2024 [11] - The company’s return on equity (ROE) is projected to decline to 2.13% in 2024, with a gradual recovery expected in subsequent years [11]