Events:
The company acquired a 59.09% stake in Wuxi Shike Micro Motor Co., Ltd. by way of equity transfer and capital increase, the company's official account Wechat said on July 31. Wuxi Shike, founded in 2009, is the world's leading supplier of motor for air conditioning compressors for new energy vehicles, with an operating income of nearly 70 million yuan in 2022.
Comments:
Expand thermal management and accelerate the development of new energy business. Wuxi Shike, as the world's leading motor supplier of air conditioning compressors for new energy vehicles, has entered the supply chain of leading automobile enterprises at home and abroad after years of development. customers include Daimler, Yutong bus, BYD, Chery Automobile, Dongfeng Automobile, Geely Automobile, SAIC Chase, Li Auto Inc., Changan Automobile, etc., covering passenger, commercial models and have achieved mass production. Through this acquisition, the company enters the field of air conditioning compressor motor, which is expected to accelerate the business income of new energy vehicles in the short term, and will help the integration of new energy vehicle thermal management products, technology and market resources in the medium to long term. Help Riley platform enterprise strategic planning to steadily achieve, enhance the competitive advantage of Jiangsu Riley new energy vehicle thermal management business.
Little giant of the motor, stride forward. The company is a widely influential micro-motor product research and design, production and manufacturing listed enterprises, the annual motor shipment volume of more than 200 million. It has formed a comprehensive business capability dominated by a variety of motor products, such as micro stepper motor, synchronous motor, DC brushed motor, DC brushless motor, micro water pump and so on, supporting relevant precision structure, drive control design and manufacturing solution. Looking forward to the follow-up, many fields of products show great potential. In terms of new energy vehicle motors, vehicle lidar motors have entered the stage of small batch production, vehicle electric air conditioning actuators and active safety motors have entered the sample testing stage, and vehicle electric air conditioning compressor controllers have entered the stage of trial production. In the field of home appliances, the company has launched a solution for the intelligent distribution system of dishwashers. Gree's new product, brushless motor for air conditioning, has entered the stage of mass production; voice coil motors for ventilators in medical devices have been recognized by customers and are in the stage of mass production. the above new products have realized the domestic substitution of key components in the field of medical devices. In the field of industrial control, micro sliding screw, planetary ball and roller screw, brushless hollow cup motor and its precision transmission components, servo motor are also in the sample testing stage.
Profit forecast: as the leading enterprise in the motor industry, the company currently has a good foundation in the fields of automobile, home appliances and industrial control, and is expected to open up more downstream areas and further improve its market position in the future. We expect the company to achieve a net profit of 3.58 / 4.82 / 6.59 yuan from 2023 to 2025, corresponding to a PE of 26 / 20 / 14 times. Give 2024 earnings 27 times PE valuation, target price of 41 yuan, the first coverage, given a "buy" rating.
Risk hint: downstream demand is lower than expected, profit forecast and valuation judgment are not as expected.