The Zhitong Finance App learned that Haitong Securities released a research report saying that demand for retail terminals is expected to be fixed in the fourth quarter, but short-term performance is still under some pressure. Among them, it is recommended to focus on sub-sectors with important marginal changes (especially leaders). Among them: supermarkets are starting a new round of optimization and transformation, preferring leaders; department stores have fixed terminal data since October, or marginal improvements; beauty care is a procyclical high-quality variety, the valuation bottom, and the cost performance ratio of leading companies; jewelry is limited by terminal demand and is expected to be affected by some pressure in the fourth quarter, waiting for an inflection point; Short-term profits are generally under pressure, leading the way is resilient Stronger.

Haitong Securities's main views are as follows:

Supermarkets: Short-term operations are under pressure, supermarkets are starting a new round of optimization and transformation

The consumption environment was still weak in the third quarter, and the overall offline retail customer flow was still under pressure. However, under the direct management model, costs were rigid, which led to an even greater decline in profits.

Department stores: Total revenue of the 3Q24 sector decreased by 8.4% year on year, gross profit margin was 33.6% (-1.0pct), expense ratio was 31.3% (+0.8pct), net profit after deducting non-return net profit decreased 89% year on year, after deducting non-net interest rate 0.1% (-1.0pct).

Supermarkets: Total revenue in the 3Q24 sector decreased 11.6% year on year, gross profit margin 21.6% (-1.2pct), expense ratio 25.5% (+0.5 pct), net profit after deducting non-return mother fell 46.4% year on year, deducted non-net profit margin -3.8% (-1.5pct) year on year. At the management level, Yonghui and Bubu High School Supermarkets are steadily advancing the reform of the Fat Donglai model. They have made phased progress, and attention is being paid to the transformation of subsequent results.

Gold jewelry: The sharp rise in gold prices affects terminal sales, waiting for the inflection point of demand

Industry: 3Q24 gold jewelry consumption was 130 tons (-29%), gold bar consumption was 69 tons (-9%). Looking at the industry as a whole, the decline in jewellery consumption was narrower than in 2Q, but there is still pressure on terminal sales due to the sharp rise in gold prices, so we need to wait for the inflection point to appear.

Channel: Gold prices have risen rapidly &; sales are slowing; franchisee sales are under pressure, and the number of stores opened and closed in the industry has increased, causing the net increase in the number of stores to slow down. Chow Tai Sang's 3Q24 franchise stores decreased by 1 (155 new, 156 closed), net increase of 6 direct-run stores (22 added, 16 closed); China Gold 3Q24 franchise stores decreased by 51 (10 added, 61 closed), 3 direct-run stores were closed; and “CHJ Chaohongji” jewelry franchise increased by 50.

Performance: Total revenue/gross profit of the 3Q24 sector was -25.2%/-28.1%, gross profit-period expenses were -42.1% year-on-year; net profit attributable to mother and net profit deducted from non-mother in the sector was -33.7%/-43.3%, respectively.

Beauty care: growth differentiation, strong channels & strong brands to consolidate competitiveness

Medicine and Aesthetics: New materials lead the growth rate, and the sector's net interest rate increased year-on-year. The total revenue of the 3Q24 sector increased 4.1% year on year, up 5.7 pct from 2q24; the sector's net profit to mother increased 6.9% year on year, and net interest rate to mother increased by 28.21% year on year by 0.7 pct year on year. Excluding Huaxi Biotech, the sector's revenue increased 12.3% year on year, net profit to mother increased 18.4% year on year, and net interest rate to mother increased 2.3 pct year on year by 43.99%. The gross margin was increased by 1.1 pct, and the sales rate was optimized.

Cosmetics: Off-season growth is under pressure, and online investment boosts brand mentality. According to Alchemy Furnace and Rubik's Cube data, the 3Q Tmall cosmetics sales growth rate was -14.3%, and Douyin cosmetics sales increased 28.9% year over year. As the e-commerce promotion cycle was extended, the full release of consumer demand made the siphon effect even more obvious. Revenue from the 3Q24 sector decreased 4.2% year on year, net profit to mother decreased by 47.5% year on year, net profit to mother decreased by 6.1% year on year, sales expenses rate of 42.8% increased 6.7 pct year on year, management expenses ratio of 8.0% increased 1.1 pct year on year, and R&D expenses rate of 3.7% increased 0.8 pct year on year. Haitong Securities believes that the industry has moved into long-term brand power competition, boosting individual product iteration, mentality strengthening, crowds breaking circles, and increasing platform marketing and promotion costs, prompting enterprises to polish their refined operation capabilities.

Cross-border e-commerce: high revenue growth in 3Q24 and differentiation in profit performance

Revenue and profit: In 3Q24, the total revenue of the sector increased by 46.6% year on year, and the growth rate increased by 8.5 pcts month-on-month. The judgment mainly stemmed from new product development, category expansion, and channel expansion. The sector's deducted non-net profit increased 1.9% year on year, and the growth rate decreased by 7.5 pct month-on-month. The sector deducted non-net interest rate was 4.6%, down 2.0 pct year on year.

Gross margin and expense ratio: In 3Q24, the sector's gross margin was 40.0%, a year-on-year decrease of 1.9 pct. The judgment was due to rising shipping costs, exchange rate fluctuations, and changes in business structure. The sector's cost rate was 34.5%, an increase of 1.0 pct over the previous year, mainly due to increased promotion and R&D efforts, and increased sales and research rates.

Aspect of the target

A-share recommendations: Commodity Mall (600415.SH), Yonghui Supermarket (601933.SH), Anke Innovation (300866.SZ), focus on Wangfujing (600859.SH), Jiajiayue (), Hongqi Chain (002697.SZ), Chongqing Department Store (Dengkang), Dengkang Dental (001328.SZ), Huakai Yibai (300592.SZ), Lao Fengxiang (Stadium). 603708.SH 600729.SH 603605.SH 600612.SH

H share recommendations: Meituan-W (03690), Mingchuang Premium (09896), Giant Biotech (02367), follow Laoshuang Gold (06181), and Alibaba-SW (09988).

Risk warning

Consumption continues to weaken; new business formats are being diverted; industry competition is intensifying; regulatory policy uncertainty.