ZTO EXPRESS(ZTO) 海通国际·2025-04-10 00:28Investment Rating - The report maintains an "OUTPERFORM" rating for ZTO Express, with a target price of USD 25.89, reflecting a potential upside from the current price of USD 16.51 [2][5]. Core Insights - ZTO Express achieved stable profitability in 2024, with revenue of RMB 44.281 billion, a year-on-year increase of 15.3%, and a net profit of RMB 8.817 billion, up 0.8% [3][12]. - The company is focusing on parcel volume growth in 2025, with guidance set at 20%-24%, aiming to exceed industry average growth rates [3][13]. - The average price per unit increased due to an optimized customer structure, contributing to revenue growth [4][13]. Financial Performance - In Q4 2024, ZTO Express reported revenue of RMB 12.92 billion, a 21.7% increase year-on-year, and an adjusted net profit of RMB 2.669 billion, up 21.5% [3][12]. - The gross margin for 2024 was 31.0%, improving from 30.4% in the previous year, driven by a significant decline in transportation costs [4][10]. - The company expects adjusted net income to ordinary equity of RMB 10.126 billion in 2025, with projected EPS of RMB 12.08 [5][14]. Revenue and Cost Analysis - Core express service revenue for 2024 was RMB 40.953 billion, a 15.7% increase, supported by a 12.6% growth in parcel volume and a 2.7% rise in unit price [4][10]. - Transportation costs decreased significantly, with a reduction of approximately 4 cents per unit in 2024, attributed to economies of scale and lower fuel prices [4][10]. Market Position and Strategy - ZTO Express completed a parcel volume of 34 billion in 2024, capturing a market share of 19.4%, despite a slight decline in growth rate [3][4]. - The company plans to enhance its market share and accelerate volume growth in 2025, focusing on high-value packages [3][5].