Items:
The company released three quarterly reports, the first three quarters revenue of 2.36 billion yuan, year-on-year + 5%, return to the mother net profit of 140 million yuan, year-on-year + 13%, deducted non-net profit of 113 million yuan, year-on-year + 3%.
Comments:
Revenue performance has declined with major customers. The company's 3Q23 achieved revenue of 751 million yuan, 9% year-on-year and-5% month-on-month, corresponding to auto major customer BYD wholesale 820000 vehicles, year-on-year + 53%, month-on-year + 17% score T China 220000, year-on-year + 18%, month-on-year-10% focus T global 510000 vehicles, year-on-year + 29%, month-on-month-6% performance has a certain drag on the company's revenue, it is estimated that the volume pace and communications business of domestic new energy customers are also under some pressure.
Performance is under short-term pressure. The company's 3Q23 realized a net profit of 19 million yuan, 57% from the same period last year,-70% from the previous year, 2.6% from the same period last year, 2.9PP from the same period last year, and 5.7PP from the previous year.
1) Gross margin: 16.5%, year-on-year + 1.0PP, month-on-month-1.8PP, estimated to be affected by the decline in capacity utilization 2) expense rate: 14.0% for three rates, + 5.1PP/+4.2PP, including 5.5% for management rate, + 1.5PP/+0.6PP for same rate, 1.3% for financial rate, 0.6% and 3.7% appreciation for Q3 midpoint against US dollar and euro, respectively. According to financial expense-interest expense + interest expense, 3Q exchange loss is estimated to be 6 million yuan. Account for-0.8% of revenue, year-on-year-1.9PP, month-on-month-2.6PP.
Electric lightweight dividend + the company's integrated die-casting competitive advantage is expected to promote the rapid growth of the company's automotive business.
Compared with the unique aluminum castings of fuel vehicles, the increment of new energy vehicles is about 30-50kg/ cars, corresponding to about 1500-2500 yuan per car. At the same time, lightweight and cost-driven integrated die-casting development, the domestic market space is expected to grow from 1.6 billion yuan at present to more than 17 billion yuan in 2025, and CAGR 122% to about 150 billion yuan in 2030. The company itself: ① actively seizes the opportunity of customer growth at the head, and grows together with domestic and foreign new energy vehicle companies, and production expansion planning in North America is already in the process; ② has accumulated experience in R & D and production of medium-sized die castings, which helps to improve the yield of medium-sized die castings and form a cost-effective advantage; after ③ integrated die-casting 8800T, the floor and battery pack have taken the lead in going offline, and the first-mover advantage will support the order taking ability of subsequent new projects.
Global 5G base station structure continues to grow, technological advantages + head customers escort the company's steady growth. The domestic 5G penetration rate is relatively high, and base station construction is slowing down, while with the exception of China, Japan, South Korea and the United States, the penetration rate of Western Europe in the world's third largest 5G market in 2022 is only 11%, while that in other regions is less than 5%. With the support of overseas increments, the global 5G base station market is still expected to achieve a growth rate of 5-10% in the future. The company's 5G base station structure heat dissipation technology has a first-mover advantage, binding the world's top two leading 5G base station equipment is also expected to escort the company's long-term steady growth.
Investment suggestion: the company has automobile + communication dual-function drive in China and North America, and is expected to further grow with the growth of leading customers in the two major segments. According to the company's three-quarter report, we adjusted the company's 2023-2025 net profit forecast from 280 million, 380 million, 510 million yuan to 190 million, 230 million, 270 million yuan,-17%, + 21%, + 21%. The company's highly profitable communications business is expected to maintain relatively stable growth, H customers are the company's largest communications customers, but also have a certain contribution in the automotive business. In addition, the company's integrated die-casting development progress is in the first echelon in the industry, has achieved mass production, but also successfully trial-produced magnesium alloy integrated die-casting products, we believe that the company has the development potential to become an integrated die-casting leader (at least one). We have adjusted the company's target PE from 35 times in 2023 to 35 times in 2024, corresponding to the target price of 37.3 yuan. Maintain the "push" rating.
Risk hints: macroeconomic and domestic consumption are lower than expected, raw material prices are higher than expected, overseas communications demand growth is not as expected, and integrated die casting business volume is lower than expected.