Core views:
Jimi Technology released its 2023 annual report. In 2023, the company achieved revenue of 3.56 billion yuan (YoY -15.8%), net profit to mother of 120 million yuan (YoY -76.0%), gross profit margin of 31.2% (YoY-4.7pct), and net profit margin of 3.4% (YoY-8.5pct). 2023Q4's revenue was 1.13 billion yuan (YoY -15.3%) and net profit attributable to mother was 0.3 billion yuan (YoY -80.0%).
In 2023, the domestic smart projection industry was under overall pressure. Domestic sales of Jimi declined, and export sales continued to grow.
On the industry side, according to IDC data, China's projector market shipped a total of 4.736 million units in 2023, down 6.2% year on year, with sales of 14.77 billion yuan, down 25.6% year on year.
At the company level, Jimi's domestic sales revenue in 2023 was 2.62 billion yuan (YoY -23.1%) and export sales were 910 million yuan (YoY +15.6%). According to Lotu Technology data, in terms of market share, Jimi maintained a leading position with a DLP market share of over 40% in 2023.
Product promotions and discounts increased due to weak domestic demand, putting pressure on 23Q4 profit margins. 2023Q4 gross profit margin 27.9% (YOY-5.9pct), net profit margin 3.0% (YOY-9.8pct), sales/management/finance/R&D expense ratios were +4.0pct/-0.1pct/+2.4pct/+0.3pct, respectively. Affected by weak demand and increased competition, the price of the 23Q4 mid-range main product, the New Z6X, has dropped to less than 2,000 yuan, and the new PLYA3 is also priced within 2,000 yuan, which has dragged down overall profit margins.
Looking ahead to 2024, the product structure has been adjusted, and it is expected that domestic profit margins will recover and overseas expansion will accelerate. In terms of domestic sales, the new cost-effective PLAY5 and the new high-end RS 10 series, priced at 1,799 yuan, have been released, which are expected to drive revenue recovery and profit margin recovery. In terms of export sales, localization teams have been gradually formed, new products have been launched one after another, and offline channels have expanded rapidly. They have successfully entered important overseas retail channels such as Best Buy and Media Markt. We look forward to accelerated overseas expansion in 24 years.
Profit forecast and investment advice: The company's net profit for 2024-2026 is expected to be 3.0, 5.0 million yuan, and 610 million yuan, respectively, with year-on-year growth rates of 146.6%, 67.2%, and 23.5%, respectively. The latest closing price corresponding to 2024 PE is 21.96x. Referring to the valuation level of comparable companies, the company was given 25 times PE in 2024, with a corresponding reasonable value of 106.13 yuan per share, giving it an “increase in holdings” rating.
Risk warning: Some parts are dependent on the risk of outsourcing, demand in overseas markets is weak, and competition is intensifying.