Event: The company released its 2023 three-quarter report. In the first three quarters of 2023, the company achieved total operating income of 81.12 billion yuan, +39.4% year-on-year, net profit of 5.077 billion yuan, +111.3% year-on-year, and net profit deducted from the mother of 5.12 billion yuan, +128.5% year-on-year. Among them, the Q3 quarter of 2023 achieved total operating income of 31.74 billion yuan, +41.3% year-on-year, net profit of 1,537 billion yuan, +35.7% year-on-year, and net profit of 1,408 billion yuan, net profit of 1,408 billion yuan, +29.1% year-on-year.
Shipment performance in the first three quarters of 2023 was excellent, and Q3 gross margin increased month-on-month. The company disclosed that in the first three quarters of 2023, the module shipment volume was 45-46 GW, the distributed systems business shipped nearly 7 GW, and the scaffolding business achieved 5.6 GW. The multi-business shipment performance was impressive. Q3 The company's gross margin increased 3.4pcts month-on-month, demonstrating the profitability and resilience of leading manufacturers.
It is expected that industry demand will continue to grow in the future, and integration and increase in N-type share will strengthen the company's competitiveness. Demand in the photovoltaic industry will maintain long-term growth in the future, and the company is expected to occupy an advantageous position in industry competition. On the one hand, the company's silicon chip integration level is improving. It is expected that the company's silicon wafer/battery/module production capacity will reach 50GW/75GW/95GW by the end of 2023; on the other hand, the company's N-type production capacity is being launched. At the end of 2022, the company already has 10GW of TopCon production capacity. In 2023, it has added 5GW of Huai'an Phase 1, Huai'an Phase 2 10GW, and 5GW in Xining, Qinghai. It is expected that by the end of 2023, the company's TopCon battery production capacity will reach 40GW.
Profit forecast and investment advice: As a leading manufacturer in the battery module industry, the company fully grasps industry opportunities to lay out overseas production capacity. Future integration and increased N-type share will strengthen the company's competitiveness in the industry. We expect the company's net profit from 2023-2025 to be 7.012 billion yuan/9.124 billion yuan/10.620 billion yuan, corresponding to PE of November 3, 2023, which is 9.0 times /6.9 times /5.9 times, respectively, covering the first time, and giving it a “buy” rating.
Risk warning: macroeconomic fluctuations; industry policy changes; policy effects falling short of expectations; impact of overseas trade policies; changes in industry competition pattern; downstream demand falling short of expectations; raw material price fluctuations.