Taijia shares are the leader of China's bimetal band saw blade industry, with the first market share in China and the top three in the world. Through long-term ploughing and technical research and development, the company's products have been replaced by domestic products to overseas exports, and the optimization and upgrading of product structure has promoted the sawing business to continue upward. On the basis of the original main business, the company acquires Yada Luoding to develop the power supply business to create a second growth curve, benefiting from the rapid development of downstream new energy power supply, the company's power supply business is expected to start quickly and become a new momentum of performance growth. We estimate that the company's homing net profit from 2023 to 2025 will be RMB 1.482,252, respectively, which is + 13.8%, 69.8% and 29.0%, respectively, compared with the same period last year. With reference to the valuation of the comparable company, the company was given a 19-fold PE in 2024, corresponding to a target price of 22 yuan, with a "buy" rating for the first time.
Bimetal band saw blade industry leader, overseas exports have become a new momentum of growth. Cutting is the basic link in the process of industrial production. as an consumable product in the process of metal cutting, band saw blade is widely used in aerospace, automobile, mechanical processing, metal smelting and many other fields. it has stable application demand and wide application scene. The company has a domestic market share of nearly 30% in the field of bimetal band saw blades, ranking first in China and the top three in the world.
After long-term ploughing, the company has established a mature product matrix and has rich customer resources, and the bimetal band saw blade has also moved from the initial domestic replacement to overseas export. The company's high-end cemented carbide band saw blade has excellent performance and cost-effective advantages, and is rapidly expanding overseas markets. according to the company's announcement, the company's middle and high-end products earned 327 million yuan in 2022, + 23.2% last year, of which cemented carbide products earned 72 million yuan. Year-on-year + 56.0% of the company's export revenue in 2022 was 189 million yuan, which was + 65.7% compared with the same period last year, and cemented carbide exports increased by 161.6%. With the rapid growth of overseas exports and the increasing share of revenue from high-end products, the increase in the proportion of high gross margin business will drive the company's sawing business to maintain strong profit performance.
Cut into the power supply to build the second growth curve, the new energy business has high growth. The company completed the acquisition and merger of Yada Rhoding in 2022. Yada Rhoding is a world-renowned power business supplier with customers covering the world's leading consumer electronics manufacturers with complete certification qualifications and customer base. The new energy power business is of high growth. According to the China Photovoltaic Association, China's new photovoltaic installed capacity 87.41GW in 2022, + 60.3% year on year. In addition, we expect that by 2025, the market size of new energy vehicle charging piles will reach 55.3 billion yuan, and the CAGR will reach 54% in 2020-2025. The company will expand its production and increase its new energy power business. According to the company's instructions, it is expected that after the project reaches full production in the third year, it will achieve an annual income of 492 million yuan and a gross profit margin of 17%. Compared with the company's power business gross profit margin of 8.8% in 2022, there will be a big boost, leading to a significant improvement in revenue and profit.
Risk factors: overseas business expansion is not as expected; bimetal band saw blade market demand is lower than expected; industry revolutionary technology; product research and development and iterative upgrading are not as expected; power business development is not as expected.
Earnings forecast, valuation and rating: we expect the company's homing net profit from 2023 to 2025 to be 1.482,252max, respectively, + 13.8%, 69.8% and 29.0%, respectively, corresponding to the closing price PE of September 25, 2023, which is 26.5Universe 15.512.0 times. With reference to comparable company valuation, sawing field Hengde has a PE of 24 times in 2024 (Wind consensus expectation). As an industry leader, the company enjoys a certain valuation premium, giving the company sawing business 26 times PE; power field in 2024, 12 times PE in 2024 with reference to comparable Sunshine Power and Aohai Technology (Wind consensus expectation), and 12 times PE in 2024 to the company's power business. The two take the average to give the company 19 times PE in 2024, corresponding to the target price of 22 yuan, covering the "buy" rating for the first time.