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Chenguang Stationery (603899): The performance of the third quarter is dazzling. Traditional business is picking up and new business continues to grow rapidly.

[Event]The company released the third quarter report of 2019 and achieved revenue of 79 in the first three quarters.

47 ppm, an increase of 29 in ten years.

78%, achieving net profit attributable to mother 8.

20,000 yuan, an increase of 28 in ten years.

36%, an increase of 32 in the next ten years.

88% (mainly government subsidies and 612 in Q3 single quarter).

90,000 yuan in subsidiary closing losses and donation expenses).

By quarter, Q1 / Q2 / Q3 revenue increased 28% / 27 respectively.

6% / 33.

0%, net profit increased by 26 each year.

4% / 25.

0% / 32.


In addition, net cash flow from operating activities was achieved6.

78 ppm, an increase of 37 in ten years.

7% (thanks to effective management of sales and purchases).

[Comments]1) The performance in the third and third quarters was impressive.

① From the perspective of revenue, Q3’s single-quarter growth rate rebounded month-on-month. It is expected that the growth rate of traditional businesses will pick up and new businesses will continue to maintain high-speed growth. ② Cost side: The product structure is 成都桑拿网 significantly upgraded, and the overall gross profit margin is increased by 0.

6 points to 26.

8% (Q3 single quarter increase by 1.

8pct); ③ Expense end: The report and the period expense rate decrease by 0.

4 points to 14.

5%, of which the sales expense ratio / management expense ratio decreased by 0.


1pct to 8.

8% / 4.


2) New product launches have helped the growth of traditional businesses pick up, and new businesses continue to grow at a high rate.

① Traditional business: Channel barriers and the ability to design and promote new products are Chenguang ‘s important competitiveness. After the adjustment in the first half of the year (new SKU listing and channel inventory adjustment), it is expected that the growth rate of traditional main business Q3 will increase in the single quarter (we judge it at 15%-20%).

Absolutely, thanks to the increase in the percentage of revenue from high value-added products such as tax reductions and boutique products, Ermei, the net profit margin of traditional businesses is still on the rise (expected to exceed 1 pct).

② Klippu: The strategy of developing national state-owned enterprises and government customers that were valued in the early stage has influenced the gross margin subsidy of Klippu (2019H1 is 12).


At present, the company is committed to the development of high-margin customers such as the Fortune 500 and the continuous optimization of the supply chain. Its revenue has maintained a growth rate of 50%, and its net interest rate has continued to increase.

③ Living Pavilion: The business model of Jiumu Miscellaneous Society gradually matured and was released at the end of last year. It has been in the high-speed opening phase in the past two years. It is expected that more than 100 stores will be added, and the merger ratio will be increased to increase profitability.
3) Other indicators: ① Delayed diabetes resistance: an early increase of 6339.

6% to 3637.

80,000 yuan, mainly due to the premium acquisition of Anshuo; ② expenses: an increase of 55.

25% to 1.7.2 billion US dollars, mainly because in the past two years, Chenguang Klip has achieved profit, and the deductible reduction in the previous period has been completed, and the tax rate in the reporting period was 25%.

4) Profit forecast: EPS is expected to be 1 in 2019-2021.



7 yuan, corresponding to 42 for PE.



6 times.

Chenguang’s products and channels are building a high moat. Currently, the brand strategy is being promoted. The new businesses Klip and Jiumu have entered the harvest period. The cultural and creative giants have ample room for growth and maintain a “strong recommendation” rating.

Risk warning: the industry is in a downturn, new products are less than expected, and new business development risks.