Core views:

The company released its 23-year performance forecast, and 23Q4 revenue reached a new high. In '23, the company achieved revenue of 840 million yuan, +31.69% year over year, realized net profit of 106 million yuan, +65.48% year over year, and realized net profit without deduction to mother of 106 million yuan, +83.13% year over year. Looking at the single quarter, 23Q4 achieved revenue of 248 million yuan, +39.28% YoY and +4.32% month-on-quarter revenue; achieved net profit of 26.48 million yuan, +13.66% YoY, and -29.69% month-on-month, achieving net profit without return to mother of 24.88 million yuan, +14.15% YoY and -31.36% month-on-month. The quick performance report shows that the company's performance improved in 23, mainly due to the increase in energy efficiency standards for refrigerators in developed countries and regions and the upgrading of domestic refrigerator consumption structures; the cost of major raw materials and liquefied natural gas declined year-on-year in '23. According to the company's investor relations records announcement in January, the reasons for the month-on-month decline in the 23Q4 profit side were mainly due to seasonal increases in liquefied natural gas during the heating season, year-end bonuses for employees, and financial expenses accrued from convertible bonds.

A new national standard for energy efficiency of household refrigerators has been drafted, and the domestic market for vacuum insulation panels is expected to further open up.

According to the official website of the National Standard Information Public Service Platform, on 2023.12.28, the National Standard Commission issued a new version of the “Household Refrigerators Electricity Consumption Limits and Energy Efficiency Classes” standard revision plan. The current standard was released in 2015 and implemented in 2016. The new standard has a 16-month project cycle and is expected to be released in 2025. The drafting of the new national standard is expected to boost domestic demand.

The buyback shows the company's confidence. According to the company's repurchase plan, the shares to be repurchased will be used for employee stock ownership plans or equity incentives, with a repurchase amount of 25-50 million yuan.

Profit forecasting and investment advice. The company's earnings per share in 23-25 are expected to be 0.91 yuan, 1.83 yuan, and 2.66 yuan, respectively. The price-earnings ratio corresponding to the current stock price is 32 times, 16 times, and 11 times. Considering the company's business structure and performance growth rate, refer to comparable company valuations, and give the company a PE valuation of 20 times its 24-year performance. The corresponding reasonable value of the company is 36.62 yuan/share, maintaining a “buy” rating.

Risk warning. Downstream demand for vacuum insulation panels fell short of expectations; exchange rates fluctuated greatly; raw materials fluctuated greatly; vacuum glass promotion fell short of expectations; major safety and environmental incidents.