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中泰国际:维持朝云集团(06601)“买入”评级 目标价上调至2.9港元

China-Thailand International: Maintaining Chaoyun Group's (06601) “Buy” rating and raising the target price to HK$2.9

Zhitong Finance ·  Apr 11 02:03

Zhongtai International raised Chaoyun Group's (06601) FY24E gross margin to 44.9%.

The Zhitong Finance App learned that, maintaining Chaoyun Group's (06601) “buy” rating, the multi-sector business resumed steady growth, with significant cost reduction and efficiency gains. Operational efficiency was improved, FY24E gross margin was raised to 44.9%, net profit was raised to 190 million yuan, up 6.0% year on year, and the target price was raised to HK$2.9. As of the end of FY23, the total cash on the company's accounts was about 2.90 billion yuan. The company maintains a high dividend payout ratio of about 7%-8%, and the valuation is attractive.

The main views of Sino-Thai International are as follows:

performance

Chaoyun Group's FY23 revenue was 1.62 billion yuan (RMB, same below), up 12.0% year on year. Among them, the home care/pet category accounted for 91.1%/4.8%. Thanks to product structure improvements, the company's overall gross profit margin was 44.5%, and gross margin reached a record high of 51.9% in the second half of the year. The cost reduction and efficiency effect of FY23 was obvious. Sales/administrative expenses fell from 41.5% of FY22's revenue to 37.9%. The full-year operating margin increased sharply from 6.0% to 13.5%. FY23's net profit was 175 million, an increase of 170.4% over the previous year, and a net profit margin of 10.8%, due to the dual effects of the recovery in sales of the main product and the benefits of cost control. Maintain an 80% dividend payout rate throughout the year.

The basic home care market is stable and steady

Revenue in the FY23 home care category resumed growth. Revenue increased 13.5% year-on-year to 1.47 billion yuan during the period; among them, revenue from insecticidal mosquito repellent and household cleaning products grew 13.5% and 14%. Chaoyun has a stable leading position in the anti-mosquito products market. The market share for insecticidal and mosquito repellent products is about 16%, ranking first for eight consecutive years; the household cleaning market share is second. FY23 home care category hair

Interest rates rose 3.1 percentage points year over year to 45.0%, the highest since 2019.

Pet stores have entered a period of rapid expansion

The pet category FY23 revenue was 77 million, the same as the previous year. In 2023, the company acquired Planet Claw and Millet, which are all pet experience store brands integrating consumer and entertainment in large shopping centers and lifestyle communities. After the acquisition, the upgrading of the original stores has already begun to bear fruit, and some stores have begun to generate profits. The 2024 plan is to accelerate the pace of expansion and transformation. The target is to increase the number of stores to 80-100 for the whole year, of which direct-operated/franchised stores account for 70%/30%; revenue is expected to reach 60 million yuan. The diversification of the pet business helps to create the company's second-largest growth curve, creating a synergy effect with pet food, health products, etc.

Disclaimer: This content is for informational and educational purposes only and does not constitute a recommendation or endorsement of any specific investment or investment strategy. Read more
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