Event description
The company publishes its 2023 semi-annual report. 2023H1 achieved an annual operating income of 243 million yuan, an increase of 9.54 percent over the same period last year, a net profit of 75 million yuan, an increase of 49.77 percent, and a non-return net profit of 54 million yuan, an increase of 9.89 percent over the same period last year.
Event comment
Industrial control connector localization of representative enterprises, actively expand new application scenarios and new customers. 2023H1, industrial control connector revenue of 157 million yuan, an increase of 2.22% over the same period last year. Industrial control connector business is the company's current main business plate, the company also continues to expand new customers and new applications, in addition to achieving the successful introduction of a single product into a number of customer projects for batch sales, the company is also actively expanding new application scenarios, there are WAFER series connectors, WD series wire-to-board connectors and other industrial robot control connectors for mass production. meanwhile. For the high-precision, high-frequency signal transmission connectors needed by automatic robots, the company also continues to promote communication and cooperation with customers, and has part of the specifications of the product mass production.
Automotive connectors are the core business support of the company's performance growth in recent years, and high-frequency and high-speed products enhance the certainty of future performance. 2023H1, car connector revenue of 42 million yuan, an increase of 31.8% over the same period last year. In the first half of the year, the company's entire car factory customers BYD, Tire 1 customers Yi Control Power, Ambofu and other customer shipments have achieved positive year-on-year growth. At the same time, the company actively seizes the market opportunity of intelligent driving of new energy vehicles, actively arranges high-frequency and high-speed products: (1) plate high-speed connectors, which have developed and realized mass production of 0.8mm spacing and 0.635mm spacing connectors, and are currently actively developing 0.5mm spacing, which is edited by the company and is mainly used in lidar, millimeter wave radar and audio and video entertainment of high-end models. Waiting for the arrival of large-scale commercial opportunities for ADAS (2) Wire harness high-frequency high-speed connectors, led by the subsidiary Dongguan Weikang, have completed the development of automotive intelligent cockpit system, self-driving system and other products. The key layout product series include intelligent driving front segment visual perception, body domain control PCB board end connection scheme, car gauge discharge grade super IP68 type-C connector assembly and high-speed Ethernet connector assembly and so on.
The new energy connector is the company's key business development and important strategic development direction, forming a new energy layout with all-round coverage in the three areas of optical storage and charging. 2023H1, new energy connectors had a turnover of 40 million yuan, an increase of 23.9 percent over the same period last year. In the first half of the year, the company grasped the efficient integration of "endogenous + epitaxial" resources, carried out joint development with key customers, expanded the connectors needed for household and commercial energy storage and charging applications, and provided photovoltaic energy storage system solutions. form the omni-directional coverage of the three areas of photovoltaic storage and charging, strengthen the business layout of new energy connectors, and enable the company's business to develop at a high speed.
Thailand invests in building a factory to expand the company's global business layout. The company announced that it intends to invest no more than 15 million US dollars in the construction of a production base in Thailand. There are no listed companies with industrial control connectors as the main business in China, and the market share is mainly concentrated in international manufacturers, and domestic alternatives are expected. As a representative enterprise in the localization of industrial control connectors, the company should actively seize the opportunity of domestic substitution of industrial control connectors.
The investment and construction of a factory in Thailand is an important part of the company's global layout, which is conducive to further improving the industrial layout and an important guarantee for smoothly cutting into the supply chain of international companies.
Investment suggestion
It is estimated that from 2023 to 2025, the operating income of the company will be 614,832,000,000 yuan (the original value is 7.19,029,410 million yuan), which is 27.8%, 35.4% and 35.1%, respectively. The net profit returned to the parent is RMB 177,000,000 (original value: RMB 1775,352,000,000), compared with 51.4%, 25.9% and 40.0%, respectively, and the corresponding EPS is 1.55, 1.95max, 2.72 (original value, 2.41), 3.48,0.80). Based on the closing price of 51.31 yuan on September 5, 2023, the PE from 2023 to 2025 is 33.2X/26.4X/18.8X. Maintain the "buy-A" rating.
Risk hint
Downstream growth is not as expected; customer introduction is not as expected; new product research and development is not as expected; international macroeconomic and political situation fluctuation risk.