Summary of the announcement: the company released its three-quarter report in 2022, with revenue of 672 million yuan in the first three quarters, an increase of 36.84% over the same period last year. The net profit belonging to shareholders of listed companies was 58.5853 million yuan, up 49.09% from the same period last year. Net profit attributable to shareholders of listed companies was 56.1402 million yuan after deducting non-recurring profits and losses, an increase of 59.

39%.

Revenue and profit hit a record high, and the automobile business is growing rapidly. In a single quarter, the company's Q3 achieved revenue of 266 million yuan, an increase of 61.27% over the same period last year, an increase of 32.39% over the previous year, and a net profit of 23.4047 million yuan, an increase of 98.61% over the same period last year and a month-on-month growth rate of 16.17%. The growth in performance was mainly due to the increase in revenue from automobile connectors, the continuous expansion of product categories and customers, and the income from 22H1 automotive products accounted for more than 70%. The company has sufficient orders on hand and rich project reserves, with inventory of 552 million yuan at the end of the third quarter, an increase of about 90 million over the end of last year. In terms of profitability, the gross profit margin in the first three quarters was 25.92%, basically the same as the same period last year, of which Q3 single-quarter gross profit margin was 24.52%, which decreased by 2.89pct and 4.48pct compared with the same period last year and month-on-month, mainly due to the climbing period of new production capacity and higher depreciation of fixed assets in the previous period. During the period of the company, the cost control was good. During the first three quarters, the expense rate was 14.96%, which was reduced by 3.65pct compared with the same period last year, and the net interest rate was 8.72%, which increased 0.72pct over the same period last year, which was higher than the level for the whole of 21 years. Overall, the company's profit margin gradually improved. It is expected that with the release of new connectors in radar modules, domain controller modules and other areas, the company's revenue will maintain a high growth, while the raw material prices fall, Jiangsu production capacity fully releases to enhance economies of scale, product structure optimization and other positive factors, the company's profitability will be further improved.

Forward-looking layout in the field of new energy vehicles, high-quality customer base. The company's automotive connector products fully cover the traditional fuel vehicle engine system, body control system, instrument control system, body bus system, safety and steering system, as well as new application scenarios such as new energy vehicle high voltage system, ADAS intelligent assistant driving, intelligent network connection, domain controller system and so on. New energy related products account for more than half of the automotive business revenue. The company continues to improve the overall solution layout of electronic and electrical architecture connectors, such as millimeter wave radar module, lidar module, intelligent cockpit system, electronic control system, etc., new products have been put into production one after another, and the competitiveness of the automotive field continues to improve.

The company has established cooperation with Valeo, Magna, Keshida, BYD, Ningde Times, Honeycomb Electric Drive, Huichuan Technology, Junsheng Electronics and other well-known automobile Tier1 at home and abroad, with terminals covering German, Japanese, American mainstream car factories and domestic independent brand first-line car companies, including Tesla, Inc., Wei Xiaoli, Jinkang and so on. Automobile electrification and intelligence open the incremental space of high-voltage and high-speed high-frequency connectors, the growth of customized demand, the eastward movement of the automobile industry and the rise of domestic new energy vehicle brands have broken the long-term competition pattern dominated by overseas. local connector manufacturers accelerate to enter the supply system, and domestic share increases. The company's early investment ushered in the harvest period, which will fully benefit from industry growth and domestic substitution opportunities.

Strengthen R & D and thicken technical barriers, and enhance delivery capacity on arrival. The company is technology-driven, with R & D expenses of 38.41 million yuan in the first three quarters of 22 years, an increase of 23.6% over the same period last year. At present, it has formed more than 100 patented technologies, and has the ability to develop new products synchronously with foreign automobile factories and automotive electronic module integrators. establish advanced mold development technology advantages, achieve mold design and manufacturing in parallel, and form a mold modular system to reduce manufacturing cycle and cost. Technical advantages ensure fast delivery and stable and good quality of the company's products, improve the ability of supporting customers, and provide reliable guarantee for the design and development of new products. In terms of production capacity, the Shanghai factory is basically full of production, and the company completed the fixed increase in July 22, raising 700 million yuan for new energy vehicle connectors and R & D center projects. after reaching production, it is expected to increase the annual production capacity of 5 million high current and voltage connectors for new energy vehicles and 12 million (sets) of auxiliary driving module connectors, which can meet the incremental product demand in the next 2 years or so, and has been put into production in the second half of the year. In addition, the company announced in August that it plans to set up a new energy source of Laimu in Hanshou, Hunan, to build a green intelligent production base, with a planned land area of 150 mu and a construction period of about 2 years. The new plant will cooperate with the existing Hunan factories to radiate South and Central China. It is mainly used to undertake the capacity demand after 2025. The project has started in October. The company's production expansion will greatly alleviate the shortage of production capacity and improve delivery capacity. Provide support for sustained growth of performance.

Investment suggestion: Laimu Co., Ltd. is a leading auto connector supplier in China, with established first-mover advantage, covering global mainstream auto parts suppliers, fully benefiting from the high prosperity of the industry and wide space for domestic alternatives. With the volume of new products and new projects, the company's performance is expected to usher in rapid growth. We expect the company's net profit from 2022 to 2024 to be 88 million yuan / 161 million yuan / 242 million yuan respectively. EPS is 0.27 yuan / 0.49 yuan / 0.74 yuan respectively, maintaining the "buy" rating.

Risk tips: rising prices of major raw materials; lower-than-expected demand risk; technology iteration risk; new energy vehicle industry competition aggravating risk.