Xinjiang Tianrun Dairy (600419) 华鑫证券·2024-05-02 02:00Investment Rating - The report maintains a "Buy" investment rating for the company [10][17]. Core Views - The company is expected to consolidate its leading position in the dairy product market within its region while continuing its expansion outside the region. The impact of the new acquisition is anticipated to gradually diminish [10]. - The first quarter of 2024 showed total revenue of 641 million yuan, a year-on-year increase of 1%, while net profit attributable to shareholders decreased by 92% to 5 million yuan, indicating short-term pressure on profits due to weak consumer demand and intense market competition [18]. - The company is accelerating the optimization of its cattle structure, which is expected to improve production efficiency and lay the foundation for profit recovery [18]. Summary by Sections Financial Performance - In Q1 2024, the company's gross margin decreased by 4 percentage points to 16.43%, with net profit margin down by 9 percentage points to 0.08% [18]. - Revenue from various product segments in Q1 2024 was as follows: ambient dairy products at 363 million yuan (up 3%), low-temperature dairy products at 240 million yuan (down 2%), livestock products at 31 million yuan (up 10%), and other products at 4 million yuan (up 74%) [19]. Market Expansion - The company has seen a net increase of 25 distributors, with a focus on expanding its distribution network outside its home region, which has shown steady growth [19]. - Revenue from the home region was 371 million yuan (up 1%), while revenue from outside the region was 267 million yuan (up 4%) in Q1 2024 [19]. Earnings Forecast - The forecast for earnings per share (EPS) for 2024, 2025, and 2026 is 0.55 yuan, 0.68 yuan, and 0.80 yuan respectively, with corresponding price-to-earnings (PE) ratios of 17, 14, and 12 times [10][26].