On October 18, 2023, Abyson released its three-quarter report for 2023, which showed that the company's revenue continued the rapid growth in the first half of the year, and its net profit increased significantly compared with the same period last year. In the first three quarters of 2023, the company achieved a total operating income of 2.537 billion yuan, an increase of 42.57% over the same period last year, and a net profit of 193 million yuan, an increase of 152.93% over the same period last year. The high performance increase was mainly due to an increase in orders and revenue. In the third quarter of 2023, the company achieved operating income of 946 million yuan, an increase of 39.20% over the same period last year, an increase of 7.15% over the previous year, and a net profit of 66 million yuan, an increase of 245.73% and 17.55% over the same period last year.

Overseas demand is the first to recover, and the domestic market has an obvious competitive advantage. The company's main products are LED large screen display and audio-visual solutions. 2023H1's overseas revenue is about 1.131 billion yuan, an increase of 64.31% over the same period last year, accounting for 71% of overseas revenue. Global business, tourism, entertainment, hotels and other formats, concerts, sports events, business exhibitions and other LED application scenarios are active again, driving the demand for businesses to show large screens. At the same time, after the recovery of international business exchanges this year, the company is more efficient in obtaining overseas orders. The domestic market has obviously picked up since the beginning of this year, especially the steady growth of LED small gap market demand. The company's domestic income in the first half of the year was 460 million yuan, an increase of 11.80% over the same period last year.

Domestic module assemblers have been gradually abandoned due to the hidden dangers of installation and inventory pressure mode. As a head machine factory, relying on competitive barriers such as brand, R & D and market advantages, the domestic module assemblers can achieve a higher growth rate, and the competition pattern of the domestic LED industry will continue to be optimized in the next few years.

The transformation of digital operation is smooth, and the operation efficiency is improved. Over the years, the company has continued to invest in digital construction and achieved results. at present, 18 major information systems covering more than 90% of the company's business have been built. with the ability of digitization, the company's operating cycle in the first half of 2023 is about 42 days, a record high, substantially ahead of companies in the same industry. 23Q3, the company's sales expenses accounted for 14.07% of revenue, down 2.6% from the same period last year, management expenses accounted for 4.89% of revenue, down 0.53%, and R & D expenses accounted for 4.47%, accounting for 0.28% of the same period last year. The company pays attention to expense rate control while revenue growth, while ensuring investment growth at the R & D level.

Enter the energy storage business, take the lead in the layout of COB high-end manufacturing. Shenzhen Ruidian Green Energy Technology, a subsidiary of the company, specializes in household and industrial and commercial energy storage products, has completed the founding team, completed the initial product development and is carrying out global safety testing and certification, and the production line is under planning. The Mini/Micro LED direct display technology of full-flip COB has formed a mature industrial chain, and the company is the forerunner of the layout of flip COB in the industry. With the commissioning and operation of the second phase of COB mass production workshop, the company's competitiveness in the high-end micro-distance display market has been greatly improved, and the business based on COB technology is growing rapidly compared with the same period last year.

[investment advice]

Abyson achieved rapid revenue and profit growth in the first three quarters of 23 years. Thanks to the first recovery of the overseas LED market, the company's overseas revenue grew rapidly. At the same time, as the LED shows that the company is the leading enterprise, it has the opportunity to gain more market share in the changing competitive structure of the industry with its own advantages. The company also attaches importance to the improvement of internal operational efficiency and achieves results through digital transformation. The company is actively expanding the cutting-edge technology of the industry, layout energy storage industry and COB packaging, and achieved preliminary results. Due to the changes in the domestic and foreign market environment and the improvement of the company's business development, we adjusted our previous profit forecast and estimated that the company's revenue in 2023, 2024, 2025, respectively, will be 3.993, 53.26, 569 million yuan, respectively, and the corresponding EPS is 1.09, 1.29 and 1.57 yuan, respectively, and the corresponding PE is 14-12-10, maintaining the "over-holding" rating.