Incidents:
The company issued a pre-performance increase announcement. According to preliminary estimates by the company's finance department, it is expected to achieve operating income of 1,232 billion yuan in 2023, and net profit attributable to owners of the parent company will increase by 69 million yuan compared with the same period of the previous year, an increase of about 87%; net profit attributable to owners of the parent company after deducting non-recurring profit and loss will increase by 72 million yuan compared with the same period last year, an increase of about 240% over the previous year. The review is as follows:
23H2 performance growth is slowing down, or is affected by multiple factors.
On the revenue side, the company's revenue growth rate reached 58.53% in the first half of '23, and the growth rate slowed in the second half of the year. 23Q3 and 23Q4 revenue growth rates were 24.29% and 23.23%, respectively. The company's revenue share in the aerospace sector reached 69.46% in 2022. We expect the 23H2 revenue growth rate to slow down mainly due to delays in delivery and acceptance by customers in the aerospace sector.
On the profit side, the company's net profit deducted from non-return mother in 2022 was 0.3 billion yuan, equity incentive expenses were 163 million yuan, and the 2023 net profit deducted from non-return mother was 102 million yuan. According to the company's draft equity incentive plan, the 2023 equity incentive fee is estimated to be about 0.8-90 million yuan. If the impact of equity incentive expenses is excluded, the company's net profit withheld from non-return mother remained basically flat in 2023. We believe it is mainly affected by the following factors: 1) The decline in gross margin. The company's comprehensive gross margin fell 6.68 pct in the first three quarters of 2023. We judge that it was mainly due to the decline in gross margin of the company's 3D printing customized product business; 2) the increase in financial expenses. The company had more loans on its account in 2023, mainly for building the company's production capacity, so financial expenses increased.
Steady increases and landings help to expand production capacity in an orderly manner, and the company's long-term development is secure. The company completed the fixed increase at the end of 2023 and raised more than 3 billion yuan. The company's fixed increase project is mainly used to increase the machine time of customized metal 3D printing products and the production capacity of metal 3D printing powder materials, with a planned full output value of more than 2.1 billion yuan. In addition, in 2021, the company invested no more than 2 billion yuan in innovative capacity building projects for the metal additive manufacturing industry with its own capital, increasing the production capacity of 1,000 units of metal 3D printing equipment after delivery.
We roughly estimate that after all the projects under construction are completed, the total output value of the company may exceed 6 billion yuan. The large-scale application of industrial 3D printing is still in its infancy. In addition to the aerospace field, where it is currently most widely used, 3D printing technology continues to be implemented in fields such as shoe molds, 3C titanium alloy parts, and flying car parts. The industry is expected to maintain long-term rapid growth, and the company will continue to benefit.
Profit forecast: The company's net profit for 2023-2025 is estimated to be 1.48, 3.52, and 488 million yuan, respectively, with corresponding PE values of 96, 40, and 29 times. Maintain an “Overweight” rating.
Risk warning: The decline in gross margin exceeded expectations; progress in expanding new application areas fell short of expectations