Q3 Performance soared, PV's second growth curve expanded at an accelerated pace, and the “buy” rating remained unchanged
2023Q1-3 had revenue of 2.28 billion yuan (+82.7%), mainly driven by the high sales growth of Fuller New Energy. Net profit of 180 million yuan (+68.0%) was net profit of 180 million yuan (+68.0%), after deducting non-net profit of 170 million yuan (+79.8%). Q3 alone had revenue of 730 million yuan (+29.6%), net profit of 0.7 billion yuan (+109.9%), net profit of 0.7 billion yuan (+109.9%) after deducting non-net profit of 600 million yuan (+130.5%). Non-recurring profit and loss mainly came from government subsidies. Q3 Performance is high. We have raised our profit forecast. We expect the company's net profit for 2023-2025 to be 2.4/30/3.7 billion yuan (original value of 2.0/2.7/320 million yuan in 2023-2025), corresponding to EPS of 0.8/1.0/1.2 yuan, and the current stock price corresponding to PE 16.9/13.5/10.9 times, maintaining the “buy” rating unchanged.
The basic market of the home appliance business is steady, and we are optimistic about the photovoltaic energy storage business to build new performance growth points
In terms of household appliance components, judging from the production schedule of the company's compressor starters and protectors corresponding to the downstream refrigerator industry, according to the industry online, emissions in October/November/December increased by 2.9%/5.3%/4.0% respectively, and the overall demand side maintained a steady growth trend. In terms of motor business, the subsidiary Zhejiang Special Electric has officially entered the BYD supply chain system. Currently, it is already supplying in small batches, and is expected to seek more orders and expand new customers for new energy vehicles. In terms of photovoltaic modules, according to the company's announcement, the company shipped about 0.8 GW of photovoltaic modules in the first half of the year, which is expected to reach 1.5-1.7 GW throughout the year.
The 2GW/year PV module production expansion project is expected to be completed and gradually put into operation in 2023. In the future, it is planned to further achieve 5GW/year production capacity in the shortest possible time. In terms of energy storage business, the company has entered a new energy storage track by signing an agreement with Changfeng Intelligence. PV modules and energy storage systems are sold together, and small-batch supply has begun. Currently, overseas sales account for about 30% of the total sales volume of Fuller New Energy's photovoltaic business. In addition, there is plenty of room for overseas development in negotiations with 3 high-quality overseas customers. The company continues to increase its product research and development efforts. Q3 has publicly obtained 9 patents, 5 invention patents, and 4 utility model patents, which is conducive to enhancing the company's competitiveness in overseas markets.
Q3 The level of gross margin increased significantly, and net profit margin is expected to decline as the business structure changes
2023Q3 has a gross profit margin of 20.2% (+8.2pcts) and a period expense ratio of 9.9% (+2.7pcts), of which the sales/management/R&D/financial expense ratio was 0.8%/5.4%/3.6%/0.1%, respectively, compared to -0.3pct/+2.8pct/-0.4pct/+0.6pct, respectively. The increase in the management expense ratio was due to the large increase in main stock payment amounts and year-end bonuses, and the increase in the financial expense ratio was mainly due to interest accrued on Q3 convertible bonds. The net profit margin for single Q3 sales is 9.5% (+3.8pcts), and the net profit margin after deducting non-net interest is 8.1% (+3.6pcts). With the increase in the share of new solar storage business, the net interest rate is expected to decline slightly.
Risk warning: raw material prices fluctuate; market competition intensifies; new energy business expansion falls short of expectations.