Events:

Golden Crown shares issued an announcement: on August 7, 2023, the company confirmed to be the contractor of the energy storage battery and ancillary equipment procurement project of Xuji Electric Energy Storage Co., Ltd., with a transaction price of 236 million yuan.

Main points of investment:

Industrial and Commercial Storage has won the order for the first large-scale domestic application of solid-state battery energy storage, and the follow-up company is expected to further expand the data center energy storage project. On August 7, 2023, the company confirmed that it was the trader of the energy storage battery and ancillary equipment procurement project of Xujianke energy storage supercomputing project, with a transaction price of 236 million yuan, which was the company's first case of energy storage in the supercomputing center. At the same time, it is also the first large-scale application of solid-state battery in China. With the landing of the project, the company's supercomputing-data center project is expected to further expand.

Industrial and commercial energy storage has the ability to deliver on a large scale, and joint ventures open up room for growth. On July 26, 2023, the subsidiary Guanghua New Energy delivered the industrial and commercial energy storage project of Ningbo Guanghua battery and completed the grid-connected operation, indicating that Golden Crown has the large-scale delivery capacity of industrial and commercial energy storage. In terms of production capacity, the company has completed the flexible transformation of 500MW PCS. After the completion of Changzhou energy storage PACK and BMS production base, energy storage capacity will be further expanded to 4.5GWh, and energy storage delivery capacity will be enhanced. In terms of customers, Jiangsu Guanhua New Energy, a subsidiary, plans to set up a joint venture with Xiamen Haichen and Sanfeng Environment to develop industrial and commercial energy storage business, and the company's industrial and commercial energy storage channels are expected to be expanded.

The Russian charging station project is progressing smoothly, and the energy storage at sea is expected to achieve a 0-1 breakthrough. In May 2023, the company announced that it had signed a "Memorandum of Cooperation" with the Middle East representative office of the Russian Federation Chamber of Commerce and Industry to carry out the construction of new energy stations mainly around the "Life supply Line" highway. 70 new energy stations are expected to be invested in the 3500 km trunk line, 3400 rechargeable stations will be built in the 170000 km spur line, and the total investment in the trunk line + branch line is close to 70 billion yuan. At present, the project is progressing smoothly, the first survey of the company's core team has been completed, and the project is in the technical docking stage. We expect that with the delivery of new energy stations, the company's energy storage business export will achieve a 0-1 breakthrough, charging pile business will usher in a large-scale expansion.

The company is the core supplier of smart grid, and the business of smart grid is growing steadily. The company is deeply engaged in the field of smart grid equipment and is the core supplier of smart grid, and its related products have been rated Class A for two consecutive years, and it is one of the few domestic enterprises with the production and processing capacity and installation qualification of the core components of C-GIS intelligent ring cabinets. In the first half of 2023, the company won the bid for multi-site distribution network project, with a total amount of more than 300 million yuan. With the upgrading of smart grid equipment around the country, we expect the company to win the bid this year is expected to further increase.

Profit forecast and investment rating: the company is the core supplier of smart grid equipment in China. With the rapid development of energy storage business, the company's industrial and commercial energy storage is reaped frequently. Energy storage is expected to achieve a 0-1 breakthrough with the Russian project, and charging piles are also expected to achieve scale expansion with the Russian project.

We estimate that the company's operating income from 2023 to 2025 will be 25.27 yuan, 3349,5136 million yuan, respectively, and its net profit will be 1.91 billion yuan, 276 million yuan, 447 million yuan respectively, and the PE will be times that of 29-20-12, maintaining the "overweight" rating.

Risk hints: the policy is not as expected, the charging pile and the process of energy storage going out to sea is not as expected; the investment in power grid is not as expected, the risk of rising prices of raw materials, and the delivery of energy storage products is not as expected.