Introduction to this report:
The company's gross margin is stable and profit margins have increased significantly. It is expected that 22H2 will further increase as raw material prices and exchange rates improve, and performance will continue to rise.
Key points of investment:
The performance was in line with expectations. The company's 22H1 revenue was 1,279 million/ +66.32%, net profit of 124 million/ +117.13%, net profit of non-return mother was 121 million/ +122.98%. Q2 Single quarter revenue was 703 million/ +76.19%, net profit of the mother was 67 million/ +158.61%, after deducting net profit of the non-return mother was 65 million/ +169.5%. Considering the high downstream boom and the company's capital expenditure increased, the EPS for 22-24 was raised to 0.89 (+0.02), 1.65 (-0.24), and 2.41 (+0.34) yuan. The comparable valuation of the reference industry gave 40 times PE in 23, raising the target price to 66 yuan, increasing holdings.
The gross margin is relatively stable, and the net interest rate has increased significantly. The gross profit margin and net interest rate of 22H1 company were 19.65% /+0.53pct and 9.66% /+2.26pct respectively, and the Q2 gross profit margin and net interest rate were 19.27% /+0.18pct and 9.54% /+3.04 pct. The increase in net interest rate was mainly due to a sharp reduction in expense rates and asset impairment losses.
The gross margin of 22H1 injection molded parts and profile stamping parts increased, and H2 gross profit is expected to improve significantly. The gross margins of 22H1's die-castings, injection molded parts, and profile stamping parts were 22.49% /-1.08pct, 19.05% /+3.39pct, 16.36% /+2.04pct, respectively. We believe that the decline in gross margin of die-casting parts was mainly due to changes in product structure. The increase in gross margin of injection molded parts and profile stamping parts was mainly due to sharp improvements in raw materials and exchange rates compared to 21 years. We are optimistic about the overall increase in gross margin after 22H2 raw materials and exchange rate improvements.
Light storage+car volume to increase capital expenditure. The company has fully benefited from the growth in overseas demand for optical storage and is expected to maintain rapid growth. At the same time, it achieved a large expansion in the automobile business in '22. The value of bicycles for major customers such as BYD and BAIC reached 2,000 yuan, and is expected to reach 3,000 yuan in the future. It is expected that the annual automobile business will account for 20% of revenue. To meet demand, the company recently announced the construction of bases in Anhui and Jiangxi. We expect to add 4 billion new production capacity within two years. Furthermore, the company's six major bases will be expanded simultaneously.
Risk warning: sharp increase in raw material prices and macroeconomic downturn