Jinwu Financial News | According to the Guangfa Securities Research Report, China Lilang (01234) announced the latest operating performance in 2024Q1. The retail sales amount of the company's “LILANZ” products achieved a high increase in the number of units compared to the same period in 2023, continuing the growth trend in 2023. According to the company's financial report, in 2023, the company achieved revenue of 3.54 billion yuan, YOY +14.8% (main series/light business series increased 10.7%/35.2% respectively); net profit of 530 million yuan, YOY +18.4%, gross profit margin of 48.2%, an increase of 2.2 pct year-on-year (mainly due to the increase in revenue share of the light business series with high gross margin); among them, the company achieved revenue of 2.05 billion yuan, YOY +21.6%, net profit of 260 million yuan, YOY +36.1%, gross profit margin of 45.5%, YoY 45.5%, year-on-year ratio 2023H2 Increase 1.8 pct.
According to the bank, the company's guidance for the full year 24 shows confidence in development. 1) The Group plans to increase the net number of stores by 100-200 in 2024 (2,695 stores at the end of 2023; 8/43 net stores for the main series/light businesses; 297/936/1,462 self-operated stores/distribution stores at the end of 2023). The new stores will be selected as the preferred location for high-quality shopping malls in provincial capitals and prefecture-level cities, while adding Ole stores to clean up inventory. 2) In 2024, the Group plans to combine the complementary advantages of online and offline stores through new retail businesses such as Douyin live streaming, and strive to increase the new retail business by more than 20% year-on-year in 2024, with overall sales growth of 15%. 3) In 2024, the Group will complete the seventh-generation renovation project for 400 stores, enhance the brand image and shopping environment, and continue to launch innovative and differentiated products. (4) The Group plans to increase the launch of new products in 2024, and plans to increase the proportion of new products with higher sales prices to enhance overall profitability.
According to the bank report, the company's earnings per share for 2024-2026 were RMB 0.50/0.55/0.61, respectively. Referring to the valuation of comparable companies in Hong Kong stocks, the company was given 10 times PE in 2024, corresponding to a reasonable value of RMB 5.0 per share. In terms of exchange rate, the RMB used 1:1.10 for the Hong Kong dollar, corresponding to a reasonable value of HK$5.47 per share. For the first time, it was covered and given a “buy” rating.