According to the company's quarterly report for 2023, 2023Q3 achieved a net profit of 289 million yuan, + 31.23% from the same period last year, + 47.12% from the previous year, and 271 million yuan from the same period last year, + 28.34% from the same period last year, and + 89.79% from the previous year. Our judgment is mainly due to the good cost control of the company, and the proportion of low-cost products is expected to further increase as the production capacity of the company's wide 8-meter production line is released quarter by quarter. We are optimistic about the long-term growth of the company and maintain the "buy" level.
Matters: on October 16, 2023, the company released its quarterly report of 2023, with revenue of 2.21 billion yuan in the first three quarters, + 5.64% year-on-year, and net profit of 668 million yuan, + 13.56% over the same period last year. Our comments are as follows:
2023Q3 realized deduction of non-return net profit of 271 million yuan, + 28.34% compared with the same period last year, and the company's performance exceeded expectations.
2023Q3 achieved revenue of 854 million yuan, year-on-year + 12.61%, month-on-month + 23.43%, net profit of 289 million yuan, year-on-year + 31.23%, month-on-month + 47.12%, deduction of non-return net profit of 271 million yuan, + 28.34%, month-on-month + 89.79%, the performance exceeded our expectations. The company's income in the first three quarters of 2023 was 2.211 billion yuan, + 5.64% compared with the same period last year, with a net profit of 668 million yuan, + 13.56% compared with the same period last year, and 574 million yuan after deduction, + 0.26% from the same period last year.
2023Q3 gross profit margin increased month-on-month, cost control is good. The company's 2023Q3 gross profit margin is 47.90%, year-on-year + 6.82pcts, month-on-month + 2.47pcts; net profit rate 33.79%, year-on-year + 4.79pcts, month-on-month + 5.44pcts.
We judge that the increase in gross profit margin is mainly due to the reduction in costs brought about by the commissioning of the company's new production line and the technical transformation of the production line. The period expense rate of 2023Q3 company is 15.17%, year-on-year + 4.83pcts, month-on-month-6.09ppt, in which the sales / management / R & D / financial expense rate is 1.00%, 6.22%, 7.21%, 0.73%, respectively, year-on-year + 0.12/+1.50/+0.97/+2.23pcts, month-on-month-0.26/-6.90/-1.85/+2.92pcts, and the overall expense rate is optimized compared with the second quarter.
Profitability has improved and production capacity has continued to expand. We estimate that the company's 2023Q3 diaphragm shipments of about 800 million square meters, corresponding to a single square meter profit of 0.35 yuan, month-on-month improvement, cost reduction has achieved initial results, it is expected that with the follow-up company's fifth-generation wet normal production capacity to increase, the company's cost reduction capacity will be further enhanced. In terms of shipments, we expect the company's shipments to reach about 3 billion / 4.5 billion square meters in 2023 / 2024, the shipping target is ahead of the industry level, and the market share level is expected to further increase.
Customers continue to develop, overseas production capacity continues to promote. In terms of customers, the company's customers have covered Ningde Times, BYD, Guoxuan Hi-Tech, China New Airlines, Yiwei Lithium Energy, Xinwanda, LG Chemistry, Samsung SDI, Japan Murata and other well-known lithium battery manufacturers at home and abroad. In terms of overseas layout, the company's Swedish and Malaysian projects continue to promote, laying the foundation for the company's expansion of overseas markets and further improving the company's global layout. With the vigorous development of overseas new energy vehicles and energy storage market, the company's new overseas production capacity continues to put into production, volume and production line efficiency continues to improve, the company is expected to maintain positive and sustained growth.
Risk factors: price decline caused by intensified market competition; market demand for new energy vehicles is lower than expected; equipment delivery is not as expected; new technology routes such as solid-state batteries are accelerated; diaphragm process is iterated rapidly; new capacity construction and production progress is not as expected.
Investment suggestion: the company's revenue, performance and profitability all improved in the third quarter of 2023 compared with the previous quarter, and we expect the company's annual shipments to reach 3 billion flat in 2023. As the company's wide production line is put into production and the shipping structure changes, the company's cost reduction and efficiency will be gradually realized, and the single flat profitability is expected to be improved, but considering the possibility that the market demand for new energy vehicles in the future is not as expected, at the same time, after the potential new capacity is put into the market, the intensification of market competition will lead to price downside risks. We adjust the company's 2023-25 homing net profit forecast to RMB 996lb 13.82pm (the original forecast is RMB 1.351 billion / 2.008 billion / 2.263 billion) to maintain the "buy" rating.