Matters:

Recently, the company released its performance forecast for 2022. The company achieved net profit of 0.30-45 million yuan for the whole year, after deducting non-net profit losses of 1.5-24 billion yuan. The sharp rise in the prices of raw materials such as copper, steel, and insulation materials since 2021 has caused losses in the company's cable business, dragging down the company's non-net profit level from 2021-2022. At present, the cable orders that the company undertook before the beginning of 2021 have basically been digested. The new orders are all priced according to the current cost of raw materials, and the company calms the impact of fluctuations in raw material prices on the profitability of the cable business through hedging. The cable business is expected to reverse losses in 2023, and the company's overall performance will improve dramatically.

Guoxin Telecom's new opinion: 1) The company is an established domestic power equipment company with a stable market position. The wire and cable business lost money in 2021-2022 due to the sharp rise in the prices of copper and other commodities, which dragged down the company's non-net profit. At present, the company's low-cost cable orders have basically been digested, and losses are expected to be reversed in 2023. 2) The company is a pioneer in the high-voltage cascade energy storage technology route. It has a strong first-mover advantage and long-term data accumulation. As domestic demand for large storage reaches an inflection point, the company's energy storage business is expected to expand rapidly. In addition, the company launched PCS products for string-type energy storage, which relied on the original industrial and commercial channel resources to lay out the industrial and commercial energy storage market. 3) We expect the company to achieve operating income of 2,269/35.40/5011 billion yuan respectively in 22-24, an increase of 20.1%/56.0%/41.5% over the previous year; the net profit returned to the mother was 0.41/1.04/249 million, an increase of -87.7%/152.6%/139.3%; initial coverage, no ratings yet.