Performance achieved high growth. Turing robots appeared at the German Industrial Fair and maintained a “buy” rating
On April 23, 2024, the company released its report for the first quarter of 2024. 2024Q1 achieved revenue of 3.391 billion yuan, a year-on-year increase of 34.44%, realized net profit of 590 million yuan, a year-on-year increase of 18.19%, realized net profit after deduction of 586 million yuan, an increase of 20.31% year-on-year, and achieved net operating cash flow of 470 million yuan, an increase of 24.58% year on year. The revenue growth was mainly due to a year-on-year increase in automation and information technology business revenue. In 2024Q1, we achieved a gross profit margin of 32.68%. With the promotion and confirmation of high-margin self-developed and localized products, we judge that long-term gross margin is expected to gradually increase. On April 22, 2024, Baoxin Turing robots appeared at the 2024 Hanover Industrial Fair (one of the world's largest industrial technology and automation exhibitions). This is also the first time Turing has appeared on the international stage. Turing Robotics is the core enterprise of Baoxin Software Holdings. Its full range of products have passed CR, CE, EAC and KCS certifications to ensure that they meet the high safety and application standards of the European market. The company will continue to expand Turing's international business network to help global manufacturing enterprises achieve intelligent upgrades. We raised the company's 2024-2026 net profit forecast to 30.7/40.1/5.29 billion yuan, respectively (previously 30.2/38.3/ 5.06 billion yuan). The current stock price corresponds to PE of 28.9/22.1/16.8 times, maintaining a “buy” rating.
As a private steel group, Hongwang Group has used Baoxin's domestic products many times to fully demonstrate its recognition of the company. Hongwang Group is an enterprise group specializing in the production of cold-rolled stainless steel, silicon steel and supporting finishing products. It is ranked 459th in the 2023 Top 500 Chinese Enterprises, 241st in the Top 500 Chinese Manufacturing Companies, and 157th of the 500 Private Enterprises in China's Manufacturing Industry. Hongwang Group and Baoxin maintain close cooperation in localization. Hunan Hongwang base and Guangxi Hongwang base have used Baoxin's full-stack localized PLC products many times. As a leading private steel company in China, Hongwang Group has repeatedly selected Baoxin Software's self-developed PLC products, which fully demonstrates the strong strength of Baoxin Software's localized products.
Domestic substitution with the autonomous large-scale PLC+industrial robot+AI model as the core driving force for growth is a scarce domestic enterprise with an independent large-scale PLC. Using large-scale PLC as the core to deepen the layout of localized products such as three-electric control systems, industrial robots, and AI models is expected to open up room for the company's long-term growth. We believe that as the company's localization projects are implemented one after another, the company's profitability is expected to continue to improve.
Risk warning: The promotion and application of large-scale PLCs and industrial robots fell short of expectations; promotion of localization fell short of expectations.