The company forecasts that the net profit of 1H23 homing will increase by 56.87% compared with the same period last year.
The company issued a 1H23 performance forecast that the expected return net profit during the 1H23 period is about 350 million yuan, an increase of 566.87% over the same period last year (the median is about 385 million yuan, up 72% over the same period last year), and the non-return net profit is about 210 million yuan, an increase of 20.54% over the same period last year (the median is about 250 million yuan, an increase of 37% over the same period last year). If equity incentives and non-recurring deductions for convertible bond fees are taken into account, the company's non-net profit during the 1H23 period is about 237-298 million yuan, an increase of 34.2%-68.7% over the same period last year.
We estimate that the net profit of the company during the 2Q23 period is about 189,259 million yuan, an increase of 25% over the same period last year (the median is about 224 million yuan, up 48% over the same period last year), and the net profit of non-returning is about 113 million yuan, an increase of 27% over the same period last year (the median is about 143 million yuan, an increase of 27% over the same period last year).
Pay attention to the main points
The diversification strategy continues to land, and the business of various business groups is growing steadily. Based on power electronics technology, the company continues to invest in high-intensity R & D for many years and continues to expand its business territory combined with epitaxial investment and acquisitions, and diversified growth strategies continue to catalyze the company's high performance growth. In 2022, the business architecture will be adjusted to six business groups, namely, intelligent home appliance electronic control, power supply, new energy vehicle and rail transit, industrial automation, intelligent equipment, and precision connection. The adjusted business architecture will be more focused and clear. In addition, from the regional point of view, the company's overseas revenue accounted for more than 30% in 2022. Considering that some businesses also have indirect exports through downstream OEM, we think that the overall overseas income accounts for a higher proportion. Regional diversification and product diversification bring more growth momentum to the company's performance development.
Scale effect continues to appear, bigger is stronger, and the return on 1H23 investment is significant. During the 1H23 period, while the company's sales scale expanded, the expense rate was also reduced. In our in-depth report on "multipolar growth creating platform Power Electronics companies" 1, we previously proposed that the expense rate during the period from 2023 to 24 is expected to repeat the scale effect between 2013 and 2019 when the company's revenue is high. In addition, the investment income of the company during the 1H23 period is about 140-160 million yuan, which is mainly due to the fair value change income of the company's foreign equity investment.
Profit forecast and valuation
Due to the higher-than-expected fair value change return on the company's 2Q23 equity investment, we raised the company's 2023 net profit forecast by 4% to 724 million yuan, while maintaining the 2024 net profit forecast. The current share price corresponds to the price-to-earnings ratio of 2023 23.2x/17.3x for 24 years. Due to the company's performance slightly exceeding expectations and the improvement of the industry valuation center, we raised the company's target price by 23% to 43 yuan, corresponding to the price-to-earnings ratio of 29.7x/22.0x in 2023, maintaining an outperform industry rating and still have 27.7% room to rise compared with the current stock price.
Risk
The demand of the industry is declining, the competition in the industry is intensified, the gross profit margin fluctuates more than expected, and the new business expansion is not as expected.