Qingsong Co. Latest Research Update: OEM Orders Marginally Recovering, Q2 Profit Improves Steadily, Name Change + ESOP Bind Long-Term Development

English summary

Qingsong Co., as a leading domestic cosmetics ODM, has seen frequent catalysts recently with multiple positive factors resonating. Customer structure continues to optimize, coupled with ESOP implementation and name change progress, the medium-to-long-term growth logic is clear. #Performance Increase Forecast: The company released a performance forecast on July 20, forecasting H1 revenue of RMB 1.107B, +18.16% YoY, with Q2 growth of 19%-20%. The company's fundamentals continue to improve, profit growth significantly higher than revenue growth, and the profit inflection point is clear. In July, orders on hand still maintained 18% growth YoY, and the full-year revenue growth target is set at 15%-20%. The company adheres to the development strategy of 'focusing on customers, focusing on products', actively discarding low-margin orders, and continuously optimizing customer and product structure; high-value-added freeze-dried products and disposable mask products are ramping up significantly, which is expected to steadily improve overall gross margin. H1 net profit center around RMB 58M, corresponding to net margin of about 5.6%; medium-to-long-term reasonable net margin target is 8-10%. ...