Core views

The company released its 2023 three-quarter report. The company's revenue for the first three quarters was 1.41 billion yuan, +50.4%; net profit of the mother was 4.2 billion yuan, +14.7%; net profit after deducting net profit of 380 million yuan, +8.9% year-on-year. Looking at Q3 in a single quarter, the company's revenue was 340 million yuan, -18.8%, -29.2%; net profit of the mother was 0.7 billion yuan, -58.2%, -61.1%; net profit after deducting net profit of 500 million yuan, -69.1% yoy, -69.5% yoy. Affected by European industry inventories and US demand falling short of expectations, the company's Q3 microreverse shipments were under pressure, and the increase in the share of micro-negative revenue made the company's overall gross margin performance superior to Q2.

occurrences

The company released its three-quarter report for 2023. The company's revenue for the first three quarters was 1.41 billion yuan, +50.4%; net profit was 4.2 billion yuan, +14.7%; net profit after deducting net profit of 380 million yuan, +8.9% year-on-year.

Looking at Q3 in a single quarter, the company's revenue was 340 million yuan, -18.8% yoy, -29.2%; net profit was 0.7 billion yuan, -58.2% yoy, -61.1%; net profit after deduction of net profit was 500 million yuan, -69.1% yoy, -69.5% yoy.

Brief review

Profitability:

The gross profit margin of a single Q3 company was 49.1%, +1.2pct yoy, +10.7pct; net profit margin 19.3%, y-18.4pct, y-16.2pct month-on-month. High gross profit increased the share of negative revenue, leading to a sharp increase in overall gross margin over the previous month.

Performance split:

1. Microinverse and DTU: Single Q3 revenue was 270 million. Affected by high European inventories and US demand, the company's microinverse shipments were under short-term pressure. Corresponding to a month-on-month increase in the price of a single unit, it is determined that the power range has increased; the gross margin has remained 50% +.

2. Energy storage: revenue of 0.7 billion yuan, gross profit margin 20%.

Non-main business items:

1. Among financial expenses, the Q3 company's interest income was RMB 31.22 million, a decrease of about 60 million yuan over the previous month, mainly due to fluctuations in interest income due to differences in financial settlement time.

2. Affected by the euro exchange rate, it is estimated that the exchange loss is 30 million yuan.

Profit forecasts and suggestions: We expect the company's 2023-2025 performance to be 6.0, 10.0, and 1.48 billion yuan, with corresponding valuations of 32.9, 19.6, and 13.3X respectively, continuing the “buy” rating.

Risk analysis

1. The prosperity of the photovoltaic storage industry falls short of the expected risk: the solar photovoltaic and energy storage industry is highly correlated with the macroeconomic situation and national industrial policy. If there are major changes in the economy or industrial policies of major markets in the future and the PV installation falls short of expectations, it will affect the development of the industry and the company's revenue and profit growth rate to a certain extent;

2. Risk that component costs will continue to rise: IGBT supply may continue to be tight, and shortages of raw materials will drive up downstream inverter costs, thereby limiting the pace of inverter shipments.

3. The risk of increased competition in the industry: The development trend of micro-inversion is good. Leading inverters have entered the market one after another with channel advantages. The production capacity of existing enterprises continues to expand, and competition in the industry has intensified, and the company's business performance may be affected.

4. Risk of RMB exchange rate fluctuations: Affected by the increase in the exchange rate of foreign currencies to RMB, there is great uncertainty about RMB exchange rate fluctuations in 2023, which may affect the company's revenue and profitability.