China South Publishing (601098 CH) Buy: Solid fundamentals, high dividend yield

研报英文原文证据摘录

China South Publishing (601098 CH) Buy: Solid fundamentals, high dividend yield

3.4 3.0 2.5 2.1

ROE (%) 10.0 9.9 10.5 10.9

revenue estimates by 1.9% and 2.5% due to weaker-than-expected demand recovery

for general books; (2) gross margin: we lower our 2026 and 2027 gross margin 52-WEEK PRICE (CNY)

estimates by 2.6ppt and 1.9ppt, mainly because we cut our general books revenue 15.00

estimates while costs are relatively fixed. We introduce our 2028 gross margin

12.45

estimate of 45.1% and 2028 earnings estimates in this report.

9.90

We expect the company to maintain a high dividend yield. The company has 06/25 12/25 06/26

historically maintained a high dividend payout ratio of 62-89%. We forecast a 2026 Target price: 14.40 High: 13.88 Low: 10.47 Current: 10.81

dividend yield of 6.4%. Source: LSEG IBES, HSBC Qianhai Securities estimates

Leading book sales via content e-commerce. Based on OpenBook, the company Jing Han* (Reg. No. S1700518080001)

ranked No.1 in physical sales via content e-commerce, with a market share of 7.31% Head of A-share Media & Internet Research

HSBC Qianhai Securities Limited

in 2025. We expect 2027 and 2028 net profit to grow y-o-y by 9% and 6%, driven by jing01.han@hsbcqh.com.cn

the expansion of its content e-commerce channel. +86 10 5795 2344

Bruce Sun* (Reg. No. S1700522090001)

Maintain Buy rating; lower TP to RMB14.40 (from RMB15.70). We continue to use Analyst, A-share Media & Internet Research

a PE multiple to value the stock. We forecast a net profit CAGR of 7.4% over 2026-28e HSBC Qianhai Securities Limited bruce.z.j.sun@hsbcqh.com.cn

(previously a CAGR of 7.5% over 2025-27e), above its 2019-23 recurring net profit +86 10 5795 2357

CAGR of 6%. Therefore, we value the stock using a 16x 2026e target PE (unchanged),