YILI(600887) 中国银河·2024-05-01 06:00Investment Rating - The investment rating for Yili Co., Ltd. is "Recommended" (maintained) [2] Core Views - The company reported a revenue of 126.18 billion yuan in 2023, a year-on-year increase of 2.4%, and a net profit attributable to shareholders of 10.43 billion yuan, up 10.6% [2] - In Q1 2024, the revenue was 32.58 billion yuan, down 2.6% year-on-year, while the net profit attributable to shareholders surged by 63.8% to 5.92 billion yuan [2] - The company plans to repurchase shares worth 1 to 2 billion yuan, with a maximum repurchase price of 41.88 yuan per share, representing 0.38% to 0.75% of the total share capital [2] Summary by Sections Revenue and Profitability - In 2023, the company achieved stable revenue growth despite industry pressures, driven by factors such as the implementation of new national standards for infant formula, successful product upgrades, and expansion into new channels [2] - Revenue breakdown for 2023: liquid milk at 85.54 billion yuan (+0.7%), milk powder and dairy products at 27.60 billion yuan (+5.1%), and ice cream at 10.69 billion yuan (+11.7%) [2] - The company’s net profit margin for 2023 was 8.3%, an increase of 0.6 percentage points year-on-year, with a gross margin improvement attributed to lower raw milk costs [2] Cost Management and Efficiency - The company has seen a continuous improvement in profitability, with a net profit margin of 18.2% in Q1 2024, up 7.4 percentage points year-on-year [2] - The gross margin for Q1 2024 improved by 2.0 percentage points, benefiting from sustained raw milk cost advantages [2] Future Outlook - For 2024, the company is expected to maintain a stable revenue growth trajectory, with a projected net profit growth of 24.8% in 2024, followed by a slight decline in 2025 and a recovery in 2026 [2] - The company aims to enhance its competitive position in the market, particularly in adult nutrition and ice cream segments, aligning with consumer trends [2] - The long-term profitability outlook remains positive, supported by digital transformation and operational efficiency improvements [2]