This report is read as follows:
In 2022, Q3 achieved a revenue of 742 million yuan, an increase of 76.77%, and a net profit of 35 million yuan, a decrease of 26.58%, slightly lower than expected. With the improvement of the cost end of equipment business, the company is expected to see the inflection point of profitability investment in Q4:
Lower the target price to 66. 85 yuan to maintain the overweight rating. Affected by the rise in raw material prices, the company's EPS forecast for 2022-2024 is 1.250.57 / 1.91 / 2.68 (- 1.96) yuan. The comparable company gave the company 35 times PE in 2023, lowering the target price to 66.85 yuan (originally 78.6 yuan) to maintain the overweight rating.
The income continued to grow at a high speed, and the net profit attributable to it was slightly lower than expected. In the first three quarters of 2022, the company realized operating income of 2.166 billion yuan, an increase of 53.95%, a net profit of 97 million yuan, a decrease of 30.23%, and a deduction of 54 million yuan from non-net profit, a decrease of 53.83%. Of this total, Q3 revenue was 742 million yuan, an increase of 76.77%, and a net profit of 35 million yuan, a decrease of 26.58%.
The rapid development of the domestic new energy vehicle industry has driven the high growth of the company's equipment and electric drive business. The revenue of Q3 company's equipment business was 463 million yuan, an increase of 47.97%, and the revenue of motor electronic control parts was 279 million yuan, an increase of 161.01%. The rapid development of the domestic new energy vehicle industry has enhanced the demand for the company's equipment business, the marginal contribution of Anhui industrial cluster is outstanding, and the motor electronic control business mainly depends on the rapid volume of old customers such as Chery New Energy.
Profitability gradually ushered in an inflection point. Affected by the rise in raw material costs and other reasons, the gross profit margin of the company's equipment business has declined to a certain extent since Q4 in 2021. As raw material costs fall and orders with higher profitability begin to cash in, the company's equipment business is expected to see a turning point in profitability in 2022. At the same time, the scale effect of electric-driven business is gradually reflected, and the product structure is continuously optimized. It has turned losses into profits in the first three quarters of 2022, and it is expected that the gross profit margin will continue to rise in the future.
Risk hint: the risk that the profit of the electric drive business is lower than expected, and the risk of a slowdown in smart equipment revenue.