The company's net profit for 23 years was 960 million yuan to 1.06 billion yuan
The company announced a pre-increase in 2023 results. It is expected to achieve net profit of 96-1.06 billion yuan in 2023, an increase of 36.9% to 51.1% over the previous year; net profit without deduction to mother of 92-1.02 billion yuan, an increase of 16.0% to 28.5% over the previous year. Considering that demand in the overseas all-terrain vehicle market is still under pressure, we lowered the company's net profit to mother in 24-25 to 12.1/1,585 billion yuan (previous time: 1,41/2.02 billion yuan). Comparatively, the company's 24 wind unanimously expected an average PE value of 14.1 times. We gave the company 14.1 times PE in 24, with a target price of 113.51 yuan (previous value 165.09 yuan), maintaining a “buy” rating.
Q4 net profit to mother achieved a high growth rate. According to the announcement, the company's Q4 net profit to mother is expected to achieve net profit of 158-258 million yuan, +20.6% to 96.9% year-on-year; net profit without return to mother was 1.52 billion yuan, +49% to 147% year-on-year. The main factors are: 1) The company is steadily advancing its global layout, gradually increasing its market share of products and increasing efficiency of scale; 2) the share of high-value-added products continues to increase, driving an improvement in the profit structure; 3) Due to matters such as government subsidies received by the company in 23 years, related non-recurring profit and loss increased profits by 358.107 million yuan.
Continued efforts are made to optimize the product structure. The all-terrain vehicle business is expected to rise steadily in 24, and the company's position as a pillar of the all-terrain vehicle business is strong, and it is expected to improve steadily in 24 years. At the product level, the company is focusing on strengthening the UTV and SSV category layout. While entering the North American four-wheel core market to increase its share, it is expected to optimize the product structure, high-value-added models, or promote price improvements. At the channel level, overseas all-terrain vehicle distribution outlets are expected to continue to expand, thereby enabling business growth. As of the mid-year report of 23, the company has reached about 600 channels in North America, and is able to closely detect and track changes in market demand. We are optimistic that the company's all-terrain vehicle business will resume growth after overseas inventory digestion is completed.
New motorcycle product reserves are abundant, and overseas channels have learned that Activate Growth Engine Company's motorcycle business product strength is impressive, firmly expanding its product matrix, and attacking major race segments. At the end of '23, the company released its first rally style model, the 450MT, to meet more aggressive tuning needs. At the same time, it also stocks major models such as the 675SR, the first domestic autonomous three-cylinder sports car, the four-cylinder racing 500SR, and the new 150SC scooter, which are expected to gain attention in European and domestic markets respectively.
We believe that the company's motorcycle business may continue to show considerable growth as new products are supported and overseas channel construction is promoted.
Risk warning: New product sales fall short of expectations, and the risk of fluctuations in exchange rates and shipping costs.