Revenue in the first three quarters of 2023 increased by 24.43% over the same period last year, and net profit from home increased by 43.46% compared with the same period last year. In the first three quarters of 2023, the company achieved revenue of 2.906 billion yuan, an increase of 24.43% over the same period last year, and a net profit of 680 million yuan, an increase of 43.46% over the same period last year. In a single quarter, revenue in the third quarter of 2023 was 1.137 billion yuan, an increase of 17.68 percent over the same period last year, and the net profit of returning home was 314 million yuan, an increase of 37.94 percent over the same period last year. In the first three quarters of 2023, the company's gross profit margin / net profit margin was 40.07% / 23.44% respectively, year-on-year change + 4.21 pct;2023 / net profit margin for the third quarter was 42.73% / 27.71%, respectively, year-on-year change + 4.52 pm / net margin 4.06 pct. On the expense side, the sales / management / R & D / financial expense rates for the first three quarters of 2023 were 4.82%, 3.47%, 5.20%, 0.83%, respectively, with a year-on-year change of-0.17, 0.72, and 0.86 pct, respectively.

The increase in the proportion of vacuum pump business leads to the continuous improvement of the company's profitability. The company's vacuum pump gross profit margin is more than 40%, which is significantly higher than that of the compressor business. In recent years, the proportion of vacuum pump business continues to increase, driving the company's profitability to continue to rise. The rapid growth of the company's vacuum pump products is mainly driven by photovoltaic vacuum pumps in the short term. In addition, semiconductor vacuum pumps continue to make breakthroughs, which is expected to further open up the company's growth space. In the photovoltaic field, the company has benefited from high prosperity + import substitution in the photovoltaic vacuum pump industry, accelerated growth in the past four years, and has become the leader of photovoltaic vacuum pumps. at present, the company has occupied the vast majority of the single crystal crystal pulling link, and the more difficult battery chip link has benefited from TOPCon production expansion + vacuum pump market share is accelerating volume, and the overall growth is expected to continue to be good. In terms of semiconductor vacuum pumps, overseas brands currently occupy about 90% of the market share. with the promotion of localization in the semiconductor field, the company's market share continues to rise. at present, it has been recognized by some domestic chip manufacturers and has begun to supply in batches. there is a broad space for domestic substitution in the future.

The development of refrigeration and refrigeration drives the growth of refrigeration compressors, and the volume of oil-free products improves the profitability of air compressors. The company is in a leading position in the field of screw compressors in China, and the overall business is developing steadily. From 2010 to 2022, the CAGR is about 10%, and the gross profit margin is stable at about 30%. In the business of refrigeration compressors, refrigerated compressors benefit from e-commerce development and vaccine transportation demand, and the terminal consumer demand gradually opens, showing a trend of rapid growth. The company maintained rapid growth in refrigerated compressors in the first three quarters of 2023, which is the fastest growing segment of refrigeration compressors. In terms of air compressors, the company continues to expand to the high-end compressor market, and has launched magnetic levitation centrifugal compressors and oil-free air compressors. At present, the gradual expansion of the company's oil-free air compressor products has led to the growth of the company's air pressure products and the continuous improvement of the profitability of the air pressure business.

Risk tips: economic recovery is not as expected; vacuum pump business expansion is not as expected; raw material prices fluctuate.

Investment suggestion: the company is the leader of domestic screw compressors and vacuum pumps, the traditional main business benefits from steady improvement in new products and new areas, vacuum pumps benefit from TOPCon battery expansion and share increase, semiconductor equipment domestic substitution accelerates, considering the company's rapid growth in the first three quarters, vacuum pump business orders are full. We have raised the company's 2023-25 net profit from homing to $1.93 billion (previous value: 8.05 + 9.73 + 11.71), which corresponds to a multiple of PE in 14-12-10 and maintains a "buy" rating.