Report summary:
The company is deeply involved in the stamping parts business, and the excellent downstream customer structure ensures the steady growth of the main business. The company's main products are mainly white car body stamping parts, including front and rear rails, water tank panel assemblies, sunroof frames, wheel covers, door and window frames, etc., with a rich product lineup. Over the years, the company has paid attention to technology accumulation and market layout in the NEV industry, and has also fully benefited from the volume of orders from new energy customers. Tesla entered the company's top five customers in 2020, Ideal Auto entered the company's top five customers in 2021, and in 2022, Tesla and Ideal Auto grew into the company's first and second largest customers respectively, accounting for 47.2% and 11.6% of the company's total revenue, respectively. Entering 2023, the company's key customers Tesla and Ideal continued to explode. In 2023, Tesla's Shanghai factory sold about 950,000 units in wholesale sales, +31% year-on-year, and Ideal Auto sold 376,000 units at wholesale sales, +182% over the same period last year. Thanks to a sharp increase in sales volume from major customers, in the first three quarters of 2023, Dolly Technology achieved net profit of 387 million yuan to mother, +22.9% over the same period last year. Looking ahead to 2024-2025, high-quality customers such as Tesla, Zero Run, and Ideal are still expected to drive the company's steady growth.
The continuous layout of the integrated die-casting business has become the core strategic direction of the company. The company strategically lays out an integrated die-casting business and continuously invests in large-scale die-casting equipment. The company began the strategic layout of the “integrated die-casting” business in 2020, and completed the installation and commissioning of the first Bühler 6100T die-casting unit in 2022. In December 2023, the inauguration ceremony of Dolly Technology's world's first Bühler 9200T die-casting unit was held at Dolly's Yancheng plant. Following the 6100T die-casting unit, Dolly Technology's second oversized die-casting unit was officially opened. In addition, Dolly Technology also has 2 sets of 6100T die-casting units that will be put into use later, and factories such as Changzhou and Anhui will also plan multiple oversized die-casting production lines.
On January 17, 2024, at the EUROGUSS 2024 exhibition site in Germany, Dolly Technology and the Swiss Bühler Group successfully renewed the purchase contract for 4 sets of Carat 920 die-casting islands, setting the largest single order for Bühler oversized die-casting equipment. In the new integrated die-casting business field, the company has now accumulated a good R&D and production foundation, and achieved a high product yield. Integrated die casting will be a powerful complement to the company's integrated and integrated supply of molds, stamping and welding.
Profit forecast and rating: The company's 2023-2025 revenue is estimated at 39.96/46.87/6.133 billion yuan, net profit to mother of 525/6.26/839 million yuan, EPS of 2.86/3.41/4.57 yuan, based on the closing price of 35.54 yuan/share on February 8, 24, and the corresponding PE is 12/10/8 times. Give it a “buy” rating.
Risk warning: Sales volume from major customers fell short of expectations, and die-casting business expansion fell short of expectations.