Event: the company publishes its 2023 semi-annual report. 2023H1 achieved revenue of 253 million yuan, + 113.82% year-on-year, realized net profit of 3.5967 million yuan, reversed losses over the same period last year, deducted 1.6154 million yuan of non-return net profit, and reversed losses over the same period last year. Among them, 2023Q2 achieved a revenue of 155 million yuan, with a month-on-month ratio of + 108.06% Universe 56.50%; a net profit of 4.2924 million yuan, a year-on-year comparison of-29.90%, a reversal of losses; a deduction of non-net profit of 3.8364 million yuan, a year-on-year comparison of + 150.73%, a reversal of losses; a gross profit margin of 23.90% for 23Q2 sales, with a month-on-month ratio of + 0.49 Universe 2.04pcts; and a sales net profit rate of 2.35%, with a month-on-month comparison-5.44/+3.20pcts. Performance is in line with market expectations.

The business of charging piles has increased rapidly, and the overseas market has gradually increased its volume. According to the data of the charging Alliance, the increment of the domestic charging infrastructure of 2023H1 is 1.442 million, of which the increment of public charging piles is 351000. As of June 2023, the total number of charging facilities nationwide has reached 6.652 million, a year-on-year increase of + 69.8%. We estimate that the total revenue of the company's 23H1 charging pile is 240 million yuan, accounting for more than 90% of the company's total revenue, of which the overseas market begins to expand, accounting for less than 10%. We estimate that the income of the 2023Q2 charging pile business is about 140 million yuan, with a month-on-month ratio of more than 50%. The gross profit margin in the domestic market is about 25%, and the gross profit margin in the overseas market is about 40%. 50%. We estimate that the company's annual charging pile business revenue in 2023 will reach more than 700 million yuan, with a gross profit margin of about 28%. Charging pile business is expected to continue to grow.

Leading in the product technology industry, many well-known customers help the business increase. In the product technical level, the company independently mastered two-way flexible charge and discharge conversion and control technology, ring high-power flexible charging technology. The company's products cover the application scenarios of the whole industry, and the charging stack products are highly recognized in the market and are in a leading position in the industry.

According to the company announcement, the company has reached strategic cooperation with many well-known customers, including State Grid, BP, Shell, Xiaocu charging, Yanchang Oil, Petrochina Company Limited, China Petroleum & Chemical Corp and so on. In addition, the company actively develops overseas markets and achieves bulk supply. We are optimistic about the long-term growth of the company's charging pile business.

Investment suggestion: considering the high downstream demand for the company's products, we expect the company to achieve a return net profit of RMB 0.59 to RMB 1.84 billion in 2023-2025, with a year-on-year turnround / + 211.1% bonus 80.3%, corresponding to an EPS of RMB 0.12, 0.36 and 0.65, maintaining a "buy" rating.

Risk tips: downstream demand is lower than expected; overseas market expansion is not as expected; industry competition is intensified.