Core views
The company announced its 2023 performance forecast and is expected to achieve net profit of 0.9-120 million yuan, with a median value of 105 million yuan, +137% year-on-year. In terms of the charging business, the company's charging module revenue increased significantly compared to the same period last year. At the same time, it also benefited from: 1) the improved level of automation to achieve improved production efficiency; 2) the continuous development of high-margin overseas customers, including the Russian, Indian, and European markets, which jointly drove the company's gross margin of business to increase, driving a significant increase in the company's overall revenue and net profit in 2023.
occurrences
The company announced its 2023 performance forecast.
In 2023, the company expects to achieve net profit of 0.9-120 million yuan, with a median value of 105 million yuan, +137% year over year; after deduction, 0.72 to 102 million yuan, median value of 87 million yuan, +180% year over year.
Corresponding to 2023Q4, net profit of 0.24-54 million yuan is expected to be achieved, with a median value of 0.39 million yuan, +57% year-on-year, and +26% month-on-month; after deduction of 0.2 to 50 million yuan, a median value of 0.35 million yuan, +61% year-on-year, and +22% month-on-month.
Brief review
In terms of the charging business, the company's charging module revenue increased significantly compared to the same period last year. At the same time, it also benefited from: 1) an increase in the level of automation: the company has a standard fully automatic SMT assembly line, and introduced a new fully automatic assembly line to improve production efficiency; 2) Continued development of overseas customers with high gross margins, including markets such as Russia, India, Europe, etc., to jointly drive the company's gross margin increase in overall revenue and net profit in 2023. The development of the company's charging modules has gone through several generations of iterative upgrades. From the initial 7.5 kW, 10 kW, 15 kW, and 20 kW to now, 30 kW and 40 kW, silicon carbide has begun to be used extensively in the architecture, and solutions for combining storage and charging, low-power DC fast charging, and liquid cooling have been derived.
In terms of smart grid business, the company gave full play to its advantages in technology research and development and marketing promotion, and achieved rapid growth in revenue. The product lineup includes power operation power supplies, distribution network automation power supplies, UPS/inverter power supplies for electric power, supporting monitoring systems, DC power systems, and intelligent AC/DC integrated power systems, etc., maintaining a leading position in the industry.
Looking ahead to 2024, in terms of charging module business, as domestic NEV sales and ownership continue to grow, demand for charging piles remains strong, and the company's overseas markets continue to develop, increasing marketing investment and customer development efforts in Europe, America, Southeast Asia, etc., the company's charging module business is expected to maintain a high level of growth; the smart grid business is expected to maintain steady growth.
Investment advice: The company's net profit for 2023-2025 is expected to be 1.0, 150, 190 million yuan, corresponding to PE 33, 22, 18 times, and maintain a “buy” rating.
Risk analysis
1) Downstream charging pile production and sales fall short of expectations: Charging module downstream charging piles may be affected by channel removal, weak demand, etc., causing industry sales to fall short of expectations.
2) Overseas policy uncertainty: In recent years, the US government has successively introduced relevant policies to raise trade barriers, such as requirements for charging pile assembly sites and the origin of a certain percentage of components, etc., which may cause domestic related industrial chains to go overseas less than expected.
3) The company's key projects fall short of expectations: As a participant in the new energy circuit, the promotion of key projects is the key to supporting revenue and profit, and is also a reflection of the company's growth. Failure to advance key projects as expected will affect current and long-term performance.