Sichuan Teway Food (603317) 长江证券·2024-11-04 07:40Investment Rating - The investment rating for the company is "Buy" and is maintained [7]. Core Views - The company reported a total revenue of 2.364 billion yuan for the first three quarters of 2024, representing a year-on-year increase of 5.84%. The net profit attributable to the parent company was 432 million yuan, up 34.96% year-on-year, and the net profit after deducting non-recurring items was 389 million yuan, an increase of 38.1% year-on-year [3][4]. - In Q3 2024 alone, the total revenue reached 897 million yuan, reflecting a year-on-year growth of 10.93%. The net profit attributable to the parent company was 186 million yuan, a significant increase of 64.79%, while the net profit after deducting non-recurring items was 179 million yuan, up 73.44% year-on-year [3][4]. - The company is experiencing an improvement in the demand for Chinese-style seasoning products, although the demand for hot pot base ingredients remains under pressure. Revenue from hot pot condiments was 794 million yuan for the first three quarters, down 6.15% year-on-year, while revenue from Chinese dish condiments was 1.272 billion yuan, up 13.5% year-on-year [3][4]. Financial Performance - The company's net profit margin increased by 3.95 percentage points to 18.29% for the first three quarters of 2024, with a gross profit margin of 39.28%, up 2.39 percentage points year-on-year. The expense ratio decreased by 2.83 percentage points to 18.66% [4]. - In Q3 2024, the net profit margin rose by 6.77 percentage points to 20.7%, with a gross profit margin of 38.83%, up 0.76 percentage points year-on-year. The expense ratio decreased significantly by 8.05 percentage points to 14.23% [4]. - The company is expected to maintain steady and rapid growth in the medium term, with projected net profits attributable to the parent company of 551 million yuan, 633 million yuan, and 719 million yuan for 2024, 2025, and 2026, respectively [5]. Market Position and Strategy - The company is positioned as a leader in the industry, benefiting from product innovation, capacity layout, and channel establishment. There are still external growth opportunities available in the industry [5]. - The company is expected to increase its investment efforts in Q4, which will support a faster revenue growth rate [4].