CICC released a research report stating that it maintained the “outperforming industry” rating of Chuangke Industrial (00669), and the 2023 performance slightly exceeded expectations. Introduced the 2024/2025 EPS forecast of $0.6/0.68, with a target price of HK$115.49. After being removed from storage in 2H22 and 2023, inventory has now fallen back to normal levels. In the future, we need to continue to pay attention to future interest rate cuts driving demand for terminal consumption. According to the US Bureau of Economic Analysis, hardware tool terminal consumption fell 3.8% year on year in January 2024. Since demand for terminals in the industry is still weak, the inventory sales ratio is still at a high level.
According to the report, in the past two years, the company has shown excellent management of American-like companies and the growth momentum of Chinese-like companies. The company's advance planning promoted operational optimization and achieved better performance and cash flow during the downturn period. In terms of business, the return of the US manufacturing industry and infrastructure investment have boosted demand for professional-grade products. Industry dividends are basically occupied by the company's core brands, making it possible to achieve strong growth against the trend. In 2023, Milwaukee's registered sales increased 10.3%. The company revealed at a public meeting that the growth rate of the consumer business changed from negative to positive in the second half of the year, with a year-on-year increase of 4%, and a double-digit decline in the first half of 2023. The company predicts that the company's revenue will grow by a medium number of units in 2024, and the main product, Milwaukee, is expected to grow by double digits.