Key points of investment:
Event: The company released the 2023 annual performance forecast:
① In 2023, we achieved net profit of 48-550 million yuan, an increase of 93.26-121.45% over the previous year, and net profit of 44-510 million yuan after deducting non-return to mother, an increase of 78.35-106.72% over the previous year. It is expected that in 2023, some assets in the company's data center business will still be depreciated, which has had a certain impact on profits for that year.
② During the reporting period, the company's performance increased year-on-year, mainly due to the company's new energy and smart power business achieving significant growth. The company closely focuses on the “Gemini” strategic planning goals, fully grasps strategic development opportunities such as the country's “digital economy” and “carbon neutrality” and market opportunities such as the global “energy crisis” and “new energy transformation”, continues to integrate and innovate in the fields of clean energy and digital infrastructure, actively exploits advantages in technology, products, solutions, services, etc., and continuously explores new market opportunities and development space. Core businesses such as photovoltaic inverters, energy storage systems, and high-end power supplies have been further strengthened.
Gemini is still shining, and new energy sources are growing rapidly:
Based on the scope of the company's net profit to mother disclosed in the performance forecast, we expect:
By industry: The new energy business is about 4 billion yuan, with a year-on-year growth rate of about 120%, of which energy storage revenue accounts for more than 60%; data center revenue is about 2.7 billion yuan, of which IDC services have intensified industry competition, and the unit price of a single cabinet has declined slightly; smart power revenue is about 1.2 billion yuan, with a year-on-year growth rate of about 18%.
Profit forecast and investment advice: We expect the company's revenue to reach 78.8/110.7/15.26 billion yuan in 2023-2025 (previous value of 93.8/122.1/16.72 billion yuan). Considering impairment and changes in investment income, net profit to mother is expected to reach 5.36/9.0/1.0 billion yuan (previous value 6.68/8.97/1,218 billion yuan), an increase of 116%/68%/11% over three years, corresponding to PE currently 18.8/11.2/10.1 times in 2023-2025 ( Based on the closing price of January 30, 2023), given the company's leading edge in data centers and the overall layout of the energy storage business in Shanghai, large storage and household storage, the future energy storage business is expected to grow rapidly in domestic and overseas energy storage capacity, giving the company 20 times PE in 2024, corresponding to a target price of 39.00 yuan/share, maintaining a “buy” rating.
Risk warning: risk of domestic industrial policy not advancing as expected; risk of overseas energy storage demand falling short of expectations; risk of worsening competition pattern; risk of insufficient supply of raw materials; risk of negative impact of performance not meeting expectations on valuation.