The 2023 results are largely in line with our expectations
The company announced its 2023 results: The company achieved operating income of 5.440 billion yuan, +23.6% year-on-year, achieved net profit of 845 million yuan, +28.8% year-on-year, and achieved net profit of 818 million yuan without return to mother and +34.5% year-on-year, which is basically in line with our expectations.
Development trends
The growth rate of the energy storage business has slowed down, and we are waiting for the inflection point of downstream storage. In terms of shipment volume, we expect that the company's annual shipments of energy storage system+all-in-one machines may reach 0.8-0.9 GWh in 23, achieving revenue of up to 1.6 billion yuan, a year-on-year increase of ~ 20%. Affected by downstream storage in Europe, the growth rate of energy storage business shipments has slowed down. In terms of price, we expect the overall price drop for energy storage products to be moderate in '23. Considering that battery costs are also falling, the gross profit per unit may remain relatively stable. Looking ahead, we expect that European household storage may continue until the end of 2Q24, and the industrial chain is expected to reach an inflection point.
The photovoltaic inverter and charging pile business grew rapidly, and the data center business developed steadily. We expect the company's photovoltaic business to achieve revenue of ~900 million yuan, an increase of more than 75% over the previous year, mainly benefiting from the high level of domestic PV installed demand; the charging pile business achieved revenue of ~200 million yuan, a year-on-year increase of ~ 80%; 2H23 charging piles gradually entered the peak delivery and inspection season, and order fulfillment was accelerated; and the data center business achieved revenue of ~2.7 billion yuan, an increase of ~ 14% year on year, maintaining a steady development trend.
The overall gross margin has been rising steadily, and the ability to control costs is good. The company's consolidated gross margin for 23 was 32.9%, +1.1ppt year on year. Among them, gross margins for data center business and new energy business were 38.1% and 27.0% respectively, +2.2ppt and +1.2ppt, respectively. The overall gross margin of the company's main business maintained an upward trend. The company's cost rate for the period (including R&D) was 12.4%, -0.3ppt year over year, showing good cost control capabilities.
Profit forecasting and valuation
We have basically kept our 24-year profit forecast unchanged and introduced a 25-year profit forecast of 1,269 million yuan. The company is currently trading at 12.1/9.9x 24/25 P/E; considering the recent decline in industry valuations, we lowered our target price by 15% to 28 yuan, corresponding to 15.9/12.9x 24/25 P/E and 31% upward space to maintain our outperforming industry rating.
risks
The macroeconomic recovery fell short of expectations, global demand for household savings fell short of expectations, and raw material prices fluctuated sharply.