What happened: the company released its third-quarter report in 2023. In the first three quarters of 2023, the operating income was 3.643 billion yuan, an increase of 1.57% over the same period last year, and the net profit was 278 million yuan, an increase of 26.22% over the same period last year. The net profit was 245 million yuan, or-0.11%, respectively. In a single quarter, 2023Q3 achieved an operating income of 1.188 billion yuan, an increase of 4.06% over the same period last year, and a net profit of 113 million yuan, an increase of 76.52% over the same period last year.
Reduce costs and increase efficiency to boost profits, while business transformation promotes profits to improve. The company's 23Q3 sales gross profit margin increased 1.26pct to 18.51% month-on-month, and sales net profit margin increased to 9.62% month-on-month, which is expected to be mainly due to the decline in raw material costs and the increase in the proportion of commercial lighting in the product structure, which is good for the profit margin of the main industry of general lighting.
Accelerate the on-board layout and open up new performance growth points. The vehicle business achieved an operating income of 340 million yuan in 2023H1, an increase of 99.3% over the same period last year, of which Shanghai Liangqin, a subsidiary responsible for headlight structural parts, achieved an operating income of 160 million yuan, an increase of 101.7% over the same period last year, and Debang Automotive Lighting, a subsidiary mainly responsible for vehicle controllers, achieved an operating income of 170 million yuan, an increase of 147.4% over the same period last year. At present, we have established a good cooperative relationship with Panasonic, Huayu Vision, Wanxiang, Marelli, Zero, Leader and Hella and other companies, and continue to get new project assignments. The company has designated projects of more than 4 billion yuan, with a project period of about 5-10 years, involving Porsche, Audi, Volkswagen, Nissan, Dafa Toyota, Guangzhou Automobile, ideal and Geely and other brands. In the field of automotive lighting, the company continues to obtain multiple fixed points of the head Tier1 enterprise; in the field of vehicle controller, the company adds nearly 400 million yuan fixed-point project of Wanxiang A123 BMS. With the company's manufacturing and R & D capabilities in the field of automotive parts, it has recently been designated as the project of Marelli S311 headlamp ECU. The project cycle is from 2023 to 2025, with a total life cycle order of about 81 million RMB.
Investment suggestion: the company is expected to have revenue of 50.74 Universe 59.88 / 7.003 billion in 2024 / 2025 and net profit of 3.82 / 477 / 7.003 billion in 2024 / 2025. The current share price corresponds to the price-to-earnings ratio of 2023E~2025E 16.75 / 13.41 and maintains the overweight rating.
Risk tips: raw materials, sea freight price increase risk; vehicle project landing is lower than expected; LED industry competition intensified.