Key points of investment

The company released its three-quarter report for 2023. The company achieved operating income of 806 million yuan in the first three quarters of 23 years, an increase of 0.45% over the previous year, and net profit of 214 million yuan, an increase of 8.72% over the previous year.

23Q3 achieved operating income of 298 million yuan, an increase of 0.84% over the previous year, and realized net profit of 74 million yuan, an increase of 6.25% over the previous year. In terms of cost ratio, the company's sales expense rate/ management expense rate/ financial expense rate/ R&D expense ratio for the first three quarters of 23 years was +5.47%/+15.23%/+0.90%/+8.07%, respectively, a year-on-year change of -0.35pcts/+1.19pcts/-0.07pcts/+1.32pcts.

Multi-physical sensor fusion to enrich product matrices. It has become a general trend for several sensors to simultaneously measure multiple physical quantities such as acceleration, temperature, humidity, and light intensity. The company is determined in its strategic transformation from a single physical sensor to the integration of multiple physical sensors, and is actively making breakthroughs in fields such as power, temperature, and pressure sensors. The company currently owns 50.50% of the shares in Shenzhen Coli Sandian Technology (power sensors). Domestic substitution demand is strong in this field, and production is expected to expand further in the future.

Furthermore, in May of this year, the company announced that it will invest 270 million yuan in a joint venture with Shenzhen **** Science City to establish Shenzhen **** Coli Intelligent Sensor Industry Development Co., Ltd. (90% of shares). It will further invest in mergers and acquisitions of high-quality sensor companies over the next three years, build an intelligent sensor industry cluster, achieve resource collaboration in marketing, cost management, finance, software, etc., and further expand the company's product matrix and enhance market competitiveness.

The six-dimensional force sensor is expected to benefit from the industrialization of humanoid robots. The six-dimensional force sensor is the crown of mechanical sensors. It can simultaneously measure the force in the three coordinate axes and the torque in the direction around the three coordinate axes. It is the highest dimensional force sensor and can be applied to automotive testing, biomechanics, and robotics. As one of the core components of humanoid robots, the six-dimensional force sensor can be used to enhance the humanoid robot's finger control and interaction ability. Currently, Collisensor's six-dimensional force sensors are in the small-batch trial production stage and are in contact with potential customers.

The company has more large-scale mass production experience than other rivals, and is expected to benefit from the large-scale deployment of humanoid robots in the future.

[Investment advice]

The company's strategic transformation from a single physical sensor to the integration of multiple physical sensors has been very effective. We predict that the company's revenue for 2023/2024/2025 will be 11.97/14.03/1,669 billion yuan, with year-on-year growth rates of 12.86%, 17.24%, and 18.91% respectively, net profit of 3.11/3.72/441 million yuan, an increase of 19.51%, 19.67%, and 18.57%. The current price corresponding to EPS is 1.10, 1.32, and 1.56 yuan, respectively. PE is 30, 25, and 21 times, giving it an “overweight” rating.

[Risk Reminder]

Fluctuations in raw material prices;

the risk of foreign investment and mergers and acquisitions;

The release of new production capacity fell short of expectations.