Results of the three-quarter report: The first three quarters of 23 years achieved revenue of 1,303 billion yuan, yoy +26.5%; net profit of 238 million yuan, yoy +57.5%; net profit of 217 million yuan, yoy +67%. Among them, Q3 achieved revenue of 455 million yuan, yoy +16.4%, -1.8%; net profit of 74 million yuan, yoy +20.9%, -18.6% month-on-month; deduction of non-net profit of 68 million yuan, yoy +23.2%, -17.7% month-on-month.
Amorphous alloy prosperity continues, waiting for profitability to improve
In terms of revenue, the first three quarters of 23 years reached 1,303 billion yuan, yoy +26.5%, mainly due to the continued boom in amorphous alloys, the company's production capacity continued to be released, and market supply capacity increased. Q3 achieved revenue of 455 million yuan in a single quarter, -1.8% over the previous quarter, a slight decrease. Looking ahead to Q4, the boom in amorphous alloys is expected to continue.
In terms of profit, 23Q3 gross profit margin was 29.88%, -0.87pct month-on-month, a slight decrease; net profit margin was 16.25%, -3.36pct month-on-month, mainly due to asset impairment drag (+14.37 million yuan month-on-month), compounded by reduced exchange earnings and increased R&D expenses.
The amorphous permeability space is broad, and the powder core business is steadily expanding
Amorphous sector: Amorphous transformers save 60%-80% of no-load energy compared to silicon steel transformers, and the replacement space is broad.
On the domestic side, fueled by higher energy efficiency standards for distribution grid transformers, the penetration of amorphous transformers is accelerating; in Southeast Asia, power grid construction is relatively backward, and electricity consumption is growing rapidly; Europe and America are actively promoting higher standards for transformer energy efficiency. The company expects that almost all transformers that meet the standards in the US will use amorphous alloys from 2027. As the world's largest amorphous production base, the company has a design capacity of 90,000 tons, and its global strategic layout is gradually being improved. It is in a period of rapid development dividends, and amorphous strips are expected to continue to rise in volume and price.
Magnetic powder sector: Benefiting from the trend of chip/integrated inductors due to boom transmission and increased demand for AI computing power in smart home appliances, new energy, etc., there is broad room for growth in inductive materials. The company's magnetic powder production capacity continues to expand, and at the same time, it has achieved stable mass production of soft magnetic powder cores in the automotive sector, which is expected to continue to optimize profitability.
Nanocrystalline sector: Nanocrystalline products for new energy vehicles are still waiting to gain momentum.
Investment advice: As a leader in the amorphous materials industry, with the release of production capacity and the release of new products, the company's performance is expected to maintain rapid growth. We expect net profit of 318/4.07/480 million yuan in 23-25, corresponding to the current stock price of 25/20/17X, maintaining the “buy” rating.
Risk warning: risk of iterative technology upgrades; risk of core technology leakage; risk of lack or loss of core technical personnel; risk of downstream demand falling short of expectations; risk of fluctuating raw material prices.