Jinwu Financial News | Sino-Thai International said that Haier Smart Home (06690) achieved revenue of 261.43 billion yuan (RMB, same below) in 2023, an increase of 7.4% over the previous year, in line with expectations. All categories have maintained a trend of increasing revenue. Thanks to continuous improvement in production efficiency, the company's gross margin increased 0.2 percentage points to 31.5%, slightly higher than expected. The company announced a year-end dividend of $0.804, and the dividend ratio increased to 45.0%, higher than expected. According to the bank, companies promoting brand upgrading in the domestic market are deepening multi-brand strategic changes to meet the needs of different user segments in China. Furthermore, high-end brand creation boosts overseas business growth.
The bank slightly raised FY24E gross margin by 0.3 percentage points; maintained FY24E's net profit forecast of 18.97 billion yuan, up 14.3% year on year, and introduced FY26E net profit forecast of 23.54 billion yuan, up 9.5% year on year. The company will continue to increase shareholder returns, and the FY24E-25E dividend ratio is expected to further increase to 50% or more, corresponding dividend rate of about 6%-7%. Raise the target price to HK$33.50, corresponding to a 15 times (maintenance) FY24E price-earnings ratio, and a “buy” rating.