Revenue is growing rapidly and profits are down compared with the same period last year. 23H1 achieved revenue of 830 million yuan, an increase of 39% over the same period last year, and a net profit of 96 million yuan, down 5% from the same period last year. 23H1's gross profit margin was 27.5%, compared with 33.6% in the same period last year, mainly affected by the increase in the proportion of module products with low gross margin, which increased to 42% of 23H1 from 20% in the same period last year. The personnel and equipment reserved for the new plant increased by an additional 35 million, while R & D expenses increased sharply to 91.81 million from 46.18 million in the same period last year, putting short-term pressure on the company's profits.
Lead the process of localization of equipment parts, domestic income has increased significantly. The company's revenue from Chinese mainland in the first half of the year was about 530 million yuan, an increase of 73% over the same period last year, while accounting for 64% of the revenue. The domestic region accounted for the main body of the revenue contribution. The company's downstream customers in China include head customers such as North China Chuang, Micro and Micro, Tuojing Technology, etc., on the one hand, the company will benefit from the rapid growth of downstream customers, on the other hand, the company will continue to reserve new products and increase R & D investment. to meet the urgent demand for domestic replacement of downstream customers' parts, it is also expected to continue to benefit from the release of new products. In terms of serving overseas customers, the company announced on August 4 that it intends to invest US $44 million to set up an overseas subsidiary, which will help to cope with the changes in the international situation and serve the needs of major overseas customers more closely.
The income of module products has increased significantly, and the proportion of modules and gas pipeline products is expected to further increase in the future. In the first half of the year, the company contributed 340 million yuan in module product revenue, an increase of 189% over the same period last year, and the proportion of revenue increased to 42% of 23H1 from 20% in the same period last year. The product structure has been continuously optimized from individual customization to modularization. In terms of the layout of new production capacity, the company's Nantong plant is currently in the stage of equipment introduction and commissioning, and is expected to reach production in 2025 with an annual capacity planning of 2 billion yuan; Beijing plant is expected to reach production capacity in 2027, with an annual capacity planning of 2 billion yuan.
We forecast that the company's earnings per share in 23-25 will be 1.40,1.96,2.79 yuan respectively (the original forecast for 23-24 years is 1.62,2.42 yuan, mainly raising the proportion of module products in income and the forecast of R & D expenses, and lowering the overall gross profit margin forecast). According to the DCF valuation method, the corresponding target price is 101.25 yuan to maintain the buy rating.
Risk hint
High dependence on the largest customer; intensified international trade frictions; intensified market competition; R & D or new product development is not as expected; changes in assumptions affect the measurement results; valuation-related risks; capacity construction and release is not as expected.