23Q3 achieved a net profit of 10 million yuan, maintaining the "overweight" rating of 23Q1-3, with revenue of 3.706 billion yuan (yoy+12.94%) and net profit of 31 million yuan (yoy-92.84%); 23Q3 revenue of 1.628 billion yuan (yoy+20.87%,qoq+48.85%) and net profit of 10 million yuan (yoy-93.27%,qoq+164.62%). We maintain the performance forecast and expect the company's 23-25 net profit to return to the parent 421 million yuan, which is comparable to the company Wind's consistent expectation of PB (23e) 1.5x, giving the company 23-year 1.5XPB, corresponding to the target price of 25.39 yuan (the previous value is 24.81 yuan), maintaining the overweight rating.

Lithium copper foil industry processing fees are still in the downward cycle, industry profits continue to be under pressure according to SMM,23Q3 6 micron and 8 micron lithium copper foil processing fees are still in a downward cycle, the average processing fee is 2.23, 21000 / ton respectively, down 17.9% and 12.8% compared with 23Q2. According to Wind,23Q2 Jiayuan Technology, Nord shares, Zhongyi Technology, Copper Crown Copper foil and other lithium copper foil industry head company profits have been near the break-even line; with the further decline in 23Q3 processing fees, industry profits continue to be under pressure. As of October 20, the processing fees for 6 microns and 8 microns have dropped to 19500 and 20,000 respectively, and the processing fees have begun to hang upside down. We think that with the head enterprise losses and processing fees upside down, it may mean that the lithium copper foil industry is close to the bottom area.

The first phase of the Jiayuan era project was officially put into trial production. Ningde Jiayuan project delayed commissioning according to the company's "voluntary disclosure notice on part of the production line of the investment construction project of the holding subsidiary entering the trial production phase" (23-10-8): the company's holding subsidiary Jiayuan era annual output of 100000 tons of high-performance electrolytic copper foil construction project has completed the first phase (50,000 tons) plant construction, the first phase of 10 production equipment has completed the installation and commissioning On September 28, 23, the first phase of the production line was officially trial-produced. In the later stage, the company will promote the construction progress of the project according to the market situation. According to the announcement on the postponement of some fundraising projects (23-10-27), the company postponed the production time of the wholly-owned subsidiary Ningde Jiayuan annual production of 15000 tons of high-performance copper foil project, which was adjusted from April 23 to December 24, mainly due to 1) intensified competition in the copper foil industry, a decline in processing fees, and 2) the delayed arrival of some of the ordered production equipment.

The company actively arranges lithium-electric composite fluid collection and energy storage business.

According to the announcement on voluntary disclosure of the Strategic Cooperation Framework Agreement and the equipment Sale contract (23-9-5), the company signed the Strategic Cooperation Framework Agreement and the equipment Sale contract with Sanfu Xinke. Through this strategic cooperation, the two sides will quickly promote the application of new technologies, new equipment and new materials in lithium-electric composite current collector. The two sides agreed to give full play to their respective capital, resources and technological advantages to carry out comprehensive cooperation around composite copper foil production equipment, processes and supporting special chemicals, the scope of cooperation includes but not limited to resource development, product procurement and processing, joint product research and development, investment, supply chain collaboration and other cooperation. In addition, the company has set up a holding subsidiary Guangdong Jiayuan Liyuan Green Electric Energy Storage Co., Ltd., which intends to engage in photovoltaic and energy storage business of new energy.

Risk hint: macroeconomic is not as good as expected and downstream demand is not as good as expected.