Revenue +16.62% YoY in '23, Net Profit to Mother +11% YoY
The company announced 23-year results: in '23, it achieved revenue of 3,913 billion yuan (yoy +16.62%), net profit to mother of 497 million yuan (yoy +11%), deducting 477 million yuan in non-net profit. 23Q4 achieved revenue of 1,136 billion yuan (yoy +21%, qoq +15%) and net profit of 110 million yuan (yoy -17%, qoq -21%). The net profit due to mother in 24-26 is estimated to be 6.2/7.6/860 million yuan. According to Wind's consistent expectations, the average PE value for 24 years is 13x, giving the company 13xPE for 24 years, corresponding to a target price of 43.94 yuan, maintaining a “buy” rating.
The cost reduction and fee control effect was remarkable, and the net interest rate remained stable in '23
Net profit margin yoy-0.01pct to 12.7% in '23, with gross margin yoy +11%, with gross margin yoy-1.32pct to 23.21%, of which 23Q4 gross margin yoy-3.12pct to 20.6%, gross margin declined. We think this may be due to intense downstream competition and increased depreciation and amortization of production lines, which increased annual depreciation and amortization of 25 million yuan year-on-year; at the same time, the company calculated fixed asset impairment for customer products of 0.3 million yuan and provision for individual customer bad debts The total impact of 60 million yuan on total profit is about 15%. However, the net interest rate returned to mother in '23 was almost flat year on year. The decline in net interest rate was less than the decline in gross margin, mainly due to the company's good ability to control expenses. The rate rate was yoy-0.9pct to 5.9% during the 23-year period, including the financial rate yoy-0.67pct/R&D rate yoy-0.4pct.
The production capacity investment+product matrix has been improved, and it is optimistic that the recruitment projects of companies providing a wide range of high-quality and lightweight services will be put into operation one after another to drive the increase in production capacity. Currently, factories such as Kunshan/Changzhou/Yancheng in Jiangsu, Chuzhou/Lu'an, Zhejiang, Jinhua, Shanghai, Lingang, Shandong, and Changsha, Hunan are supporting stamping and die-casting parts.
The company expects full production of stamping parts to support an output value of 6 billion yuan. In terms of integrated die castings, based on an understanding of the manufacturing process of white car bodies, the company successfully entered the integrated die-casting circuit, effectively supplementing the stamping and welding parts business. The company has laid out 4 production lines in Yancheng, Jiangsu and Lu'an, Anhui, and plans to invest in a new integrated die-casting project in Jintan, Jiangsu. In addition, the company has also expanded businesses such as thermoforming, electrophoretic paint, and composites, and has laid out corresponding production capacity. We are optimistic that with the release of production capacity and the improvement of the business matrix, the company will provide customers with a full range of high-quality services.
Integrated die casting expands production capacity in an orderly manner, and is optimistic about future performance release
The company entered integrated die-casting or began a new growth curve. The 22Q4 Yancheng Duoli 6100-ton integrated die-casting production line was put into use. In September '23, Kunshan Daya, a wholly-owned subsidiary of the company, won the integrated die-casting back plate fixed by the leading domestic new energy OEM. The company expects mass production over 25 years, with sales revenue of 21-23 billion yuan throughout the life cycle, fully verifying its process capabilities and business capabilities, and is expected to gradually release revenue in 25 years. In terms of other production capacity, Yancheng Duoli's 9,200-ton integrated die-casting production line and Anhui Daya's plan's two 6100-ton integrated die-casting production lines are all in the installation stage. At the same time, the company plans to continue to lay out integrated die-casting production lines in Jintan, Jiangsu in the future. We are optimistic that with excellent production control capabilities and sufficient production capacity scale, integrated die-casting performance will usher in volume growth.
Risk warning: customer development falls short of expectations; downstream demand falls short of expectations; integrated die casting progress falls short of expectations.