SKSHU(603737) 国投证券·2025-04-28 04:35Investment Rating - The investment rating for the company is "Buy-A" with a 6-month target price of 53.90 CNY [5]. Core Views - The company has shown continuous revenue growth in home decoration paint for 2024 and Q1 2025, with a significant increase in net profit due to reduced expenses and impairment losses [2][3]. - The decline in revenue growth is primarily attributed to the decrease in engineering wall paint sales, while home decoration wall paint revenue has increased due to expanded channels and promotional efforts [3][10]. - The company is transitioning towards high-end retail and enhancing its small B channel network, which is expected to drive growth in both retail and engineering segments [10][11]. Summary by Sections Financial Performance - In 2024, the company achieved a revenue of 12.105 billion CNY (down 2.97% YoY) and a net profit of 332 million CNY (up 91.27% YoY) [2][3]. - For Q1 2025, the revenue was 2.130 billion CNY (up 3.12% YoY) with a net profit of 105 million CNY (up 123.33% YoY) [2][9]. - The company plans to distribute a cash dividend of 3.20 CNY per 10 shares and increase capital stock by 4 shares for every 10 shares held [2]. Revenue Breakdown - Home decoration wall paint revenue reached 2.967 billion CNY (up 12.75% YoY), while engineering wall paint revenue was 4.084 billion CNY (down 12.65% YoY) [3]. - The company’s gross margin for 2024 was 29.60%, with a Q4 gross margin of 32.50% [4][8]. Future Projections - Revenue projections for 2025-2027 are 13.369 billion CNY, 14.674 billion CNY, and 16.016 billion CNY, with net profits expected to be 809 million CNY, 959 million CNY, and 1.125 billion CNY respectively [11][14]. - The company is expected to maintain a dynamic PE of 31.7x, 26.7x, and 22.8x for the years 2025, 2026, and 2027 [11][14].