Events. On October 16, 2023, the company released the third quarterly report of 2023. The company Q3 realized revenue of 854 million yuan, an increase of 12.61%, a ring increase of 23.43%, a net profit of 289 million yuan, an increase of 31.23%, a ring increase of 47.12%, and a non-return net profit of 271 million yuan, an increase of 28.34% and 89.79%.
Gross profit margin: 2023Q3 gross profit margin is 47.90%, the same increase 6.82pcts, ring increase 2.47pcts. Net interest rate:
The net interest rate of 2023Q3 is 35.23%, with an increase of 4.76pcts and an increase of 6.60pcts.
The single flat net profit is significantly improved, and the cost reduction effect is significant. In terms of shipments, the company's Q3 shipments are about 780 million square meters, and capacity utilization continues to improve compared with Q2. Q4 we expect company shipments of 10-1.2 billion square meters and 28-3 billion square meters for the whole year. In terms of single flat net profit, the company's Q3 single flat buckle non-net profit is 0.35 yuan / flat, Q2 has increased by more than 0.1 yuan / flat, and single flat profitability has improved significantly. We think the main reasons are: 1. On the cost side, the fifth generation super wet production line of Q3 Nantong contributes production capacity, the width of the fifth generation production line is more than 8 meters, and the single production capacity is 250 million square meters, which can effectively improve the overall economies of scale and reduce production costs. 2. On the price side, the diaphragm price adjustment is basically over, and the price of Q3 is basically the same as that of Q2; 3. On the expense side, the company's Q3 management expense rate is 6.22%, the month-on-month reduction of 6.9pcts, and the management cost is greatly reduced. Looking back, the company's fifth-generation super production line continues to be put into production, which will continue to reduce costs and increase efficiency for the company, and the follow-up profitability of the company is expected to be maintained.
The globalization of production capacity accelerates the layout and the level of inventory management is excellent. On August 26, the company announced that it planned to build a diaphragm production base in Penang, Malaysia, with a total investment of no more than 5 billion yuan and a capacity of 2 billion square meters after reaching production. In terms of the Swedish project, the coating production line was put into production in May 2022, and the construction of the project progressed smoothly. In terms of inventory, by the end of June 2023, the company's inventory was about 284 million yuan, far below the peer average.
Investment advice: we expect the company to achieve revenue of 33.89,46.24 and 6.206 billion yuan from 2023 to 2025, with year-on-year growth rates of 17.7%, 36.4% and 34.2% respectively, and net profit of 9.62,12.60 and 1.674 billion yuan respectively, with year-on-year growth rates of 33.8%, 30.9% and 32.9%, respectively. The PE corresponding to the current price on October 17, 2023 is 20, 15 and 11 times, respectively. In view of the continuous operation of the company's super cable production capacity and the continuous optimization of overseas markets, the "recommended" rating is maintained.
Risk tips: new energy vehicle sales are not as expected; new capacity construction and production schedule is not as expected; overseas customer development is not as expected.