Core views:
The company released its 2023 annual report and 2024 quarterly report, and its performance continued to grow. Revenue in 2023 was 1.06 billion yuan, +40.41% year on year; net profit to mother was 117 million yuan, -23.94% year on year (the company's equity incentive cost in 2023 was about 72.29 million yuan); gross profit margin was 40.89%, -1.04pct year on year; net profit margin was 11.04%, -9.34pct year on year. Among them, 23Q4 revenue was 302 million yuan, +11.43% year over year; net profit to mother was 0.32 million yuan, -46.60% year over year; gross profit margin was 41.29%, +0.61 pct month on month; and net profit margin was 10.45%, -0.43 pct month on month. 24Q1 revenue of 269 million yuan, +16.10% year over year; net profit to mother of 0.27 million yuan, -17.31% year on year; gross profit margin 38.04%, -3.25pct month on month; net profit margin 10.00%, -0.45pct month on month. Downstream customers went to the warehouse in the first quarter to gradually respond to product price cuts. It is expected that the high growth trend will not change throughout the year.
The new energy sector continues to grow, and the core business has performed well. In 2023, NEV fuse revenue was 596 million yuan, +54.66% year on year; gross profit margin was 39.32%, +0.81 pct year on year; wind and solar storage fuse revenue was 345 million yuan, +23.66% year on year; gross profit margin was 44.77%, -3.55pct year on year; industrial control and other fuse revenue was 59 million yuan, +51.48% year over year. Downstream customers going overseas drive demand to continue to increase, and the new energy circuit is expected to continue to contribute to performance growth.
The Thai factory has been set up, and the global market layout has basically been completed. According to the annual report for '23, the Korean subsidiary, the Hong Kong subsidiary, the German subsidiary, the Singaporean subsidiary, the American Sun Company, and the Thai Sun Company have all been established. In 2024, the company will achieve smooth mass production at the Thai production base, accelerate its entry into the global market, and increase its share of overseas revenue.
Profit forecasting and investment advice. As a leader in fuses, the company actively lays out globally, and is expected to benefit from the increase in the global penetration rate of new energy vehicles. The company's revenue for 2024-2026 is estimated to be 1.43 billion yuan, 19.6 billion yuan and 2.49 billion yuan, respectively, and net profit to mother is 2.2, 370 million yuan, and 4.9 billion yuan, respectively. The company was given 30 times PE in 2024, corresponding to a reasonable value of 100.13 yuan/share, maintaining a “buy” rating.
Risk warning. Sales of new energy vehicles fell short of expectations; market competition increased risk; risk of fluctuations in raw material prices.