Event: in the first three quarters of 2023, the operating income was 2.335 billion yuan, down 23.34% from the same period last year, and the net profit from home was 10.3007 million yuan, down 94.80% from the same period last year. The net profit from non-return to home was 6.3695 million yuan, down 97.20% from the same period last year.

Notebook recovery laid the foundation for performance inflection point, single-quarter revenue, profit month-on-month repair. In the aforementioned comments, we pointed out that the downriver recession led to layoffs in the Kunshan plant, the cost caused by the sluggish production of some material products, and the slow increase in the production capacity of the Nanchang factory, which were the root causes of the company's continuous losses in 2022Q4 and 2023Q1. With the gradual elimination of negative factors, with the help of the recovery of notebook demand, cost reduction and efficiency efficiency, the profit in a single quarter continued to improve, and the net profit of returning home in the third quarter was 25.5836 million yuan. An increase of 85.90% month-on-month.

The warming trend of the laptop industry is clear, AI PC is expected to boost long-term growth, upstream suppliers out of the cold night.

According to IDC statistics, the year-on-year decline in global PC shipments has been narrowing for two consecutive quarters, and after an one-year inventory elimination cycle, the current machine inventory has gradually returned to a reasonable water level. It is expected that the overall laptop shipments will pick up next year, and the penetration of AI functions in the notebook field is expected to promote a new replacement cycle. In the Spring and Autumn period, as an electronic segment, notebook structures account for the largest proportion of revenue. At the same time, it is also the leading manufacturer with the most stable relationship with several major brands in China, and will usher in the growth flexibility of orders and production capacity growth rate.

The business of automotive magnesium structure parts has grown steadily, building the second growth curve. The use of magnesium alloy structural parts is an effective way to lighten the weight of automobiles. Chunqiu Electronics is one of the few domestic production enterprises with semi-solid injection molding ability. At present, the company already has the production capacity of the central control instrument panel and automotive structural components of various sizes, and has also signed a strategic cooperation agreement with Desai Xiwei. In the future, with the continuous improvement of process size, it is expected to layout CCB crossbeam, motor shell and other larger size magnesium parts. The lightweight of magnesium alloy parts is an important trend in the development of new energy vehicles, and is expected to become a new performance growth point.

Investment suggestion: the company's 2023-2025 net profit is expected to be 0.61,2.03 and 342 million yuan respectively, and the current share price is 70.6,21.3 and 12.7 times PE respectively, maintaining the buy rating.

Risk tips: (1) laptop shipments further decline; (2) magnesium alloy structure penetration of new energy vehicles is not as expected.