The company issued 2023 and 2024Q1 performance announcements: in 2023, it achieved revenue of 902 million yuan, +25.0% year on year, and net profit to mother of 200 million yuan, +38.9% year on year. 2024Q1 achieved revenue of 240 million yuan, +32% /month-on-month -7%; net profit to mother of 60 million yuan, +59% /month-on-month +25%.
Two-wheel drive revenue in traditional and emerging businesses has increased, and management's announcement that it will not reduce its holdings shows long-term confidence. In 2023, the company continued to take advantage of its infrastructure business and expand new projects for leading domestic and foreign car companies with a Tier 1 role, driving the cleaning system/cleaning pump business to record +25.9%/+11.5%, respectively. The trend of electrification and intelligence has led to an increase in demand for automotive micromotors. The company's “four doors and two covers” superior products continued to improve, and achieved vertical breakthroughs in “motor+actuator” in the field of invisible doorknobs and charging small doors, which together led the motor business to record +37.6% year-on-year. In the future, the company is committed to building a richer supermarket for automotive motor products, gradually covering high-value products such as high-torque harmonic brushless, ESP, EPB, ABS, and seat motors. Furthermore, the company's actual controller promised not to reduce its holdings of the company's shares in any way for 6 months from April 22, demonstrating the management's confidence in the company's long-term development.
Global production capacity is being expanded in an orderly manner, and the expansion of upstream integration is driving increased profitability. In 2023, the company's core motor process capacity utilization rate reached 102.4%, and economies of scale continued to be unleashed. In order to better meet nearby supporting demand, the company is speeding up the expansion of overseas production capacity. The Thai base is expected to be ready for use by 2024Q2, and some designated projects at the US base will be mass-produced within the year, which is expected to drive continued revenue growth and profit structure optimization. The company continued to promote vertical integration of production, achieved self-manufacturing of injection molding and stamping process components, and greatly reduced manufacturing costs, driving the company's 2023Q4/2024Q1 gross margin to 36.7%/36.8%. Combined with the company's good control of sales and management expenses and positive contribution to exchange earnings, the company's 2023Q4/2024Q1 net margin increased to 19.9%/26.8%. 2024Q1 also set the best level in the company's historical quarter.
The industrialization of ADAS intelligent cleaning continues to accelerate, and the third growth curve for industrial robots is breaking through. L2+ intelligent driving accelerates penetration, leading to increased demand for ADAS intelligent cleaning systems. At present, the company has developed a new generation of cleaning system products with active sensing functions, and has carried out product road tests and system adaptations with many customers. In 2023, there are small-batch order projects. It is expected that more new models will enter the fixed stage during the year, leading the industry in terms of industrialization implementation progress. Seizing the blue ocean development opportunities for humanoid robots, the company pioneered the development of customized products such as frameless torque motors and hollow cup motors required for humanoid robots based on deep technical reserves in the past, and leveraged the customer synergy advantages of automobiles and industrial automation to accelerate product promotion and industrialization, which is expected to open up a new market space for the company.
Profit forecast and valuation: The company's net profit for 2024-2026 is estimated to be 270 million/350 million/4.4 billion yuan, respectively, corresponding to PE 23.5/17.9/14.3 times, respectively, maintaining a “buy” rating.
Risk warning: Risk of fluctuations in raw material prices and exchange rates; new business development and production capacity fall short of expectations; industry demand falls short of expectations.