Q1 revenue increased steadily. We are optimistic about annual performance growth. In Q1, Ancore released a quarterly report, maintaining the “buy” rating. In 2024, Q1 achieved revenue of 242 million yuan (yoy +5.07%), net profit of 45.2398 million yuan (yoy +8.18%), deducting non-net profit of 39.054 million yuan (yoy +9.06%).
The company's profitability continued to increase, and the net interest rate increased by 0.55pct year-on-year, mainly due to the optimization of cost control effects. Considering the strong demand for EMS 2.0 and maintaining profit forecasts, the company's 2024-2026 EPS is expected to be 1.24, 1.59, and 2.11 yuan, respectively. Comparatively, in '24 Wind, the average PE was expected to be 20 times. Considering that the company's software business advantages and product competitiveness are becoming more prominent, the company was given 25 times PE in 24X, corresponding to a target price of 31.00 yuan (previous value of 32.24 yuan), maintaining a “buy” rating.
The cost control effect was good, and the net interest rate increased by 0.55pct year-on-year
The overall gross margin of the 24Q1 company was 47.03%, a slight decrease of 0.48 pct year on year and an increase of 5.61 pct month on month.
Looking at the annual level, considering the continuous increase in the company's share of software business and the rapid advancement of overseas high-margin business, we believe that the company's gross margin level is expected to continue to be optimized throughout the year. The 24Q1 sales/management/R&D expenses ratio was 10.70%/6.50%/11.58%, respectively, -2.17pct/-1.42pct/ -1.56pct. The company's cost control effect was good, and team efficiency was continuously optimized. Benefiting from the reduction in the rate during the period, the 24Q1 company's net interest rate was 18.68%, an increase of 0.55pct over the previous year. We believe that with the promotion of software upgrades of the company's products and the optimization of enterprise management efficiency, the company's profitability is expected to continue to improve.
Microgrid management requirements are becoming increasingly complex. We are optimistic that the release of EMS 2.0 demand will follow the iterative upgrading of the company's products and changes in market demand, and EMS 2.0 products will gradually become the core driver of the company's revenue growth. On the basis of EMS 1.0, EMS 2.0 enables platform-based integration of core functional modules such as reliable use of electricity, safe use of electricity, and efficient use of electricity in microgrids, breaking down power data silos on the user side and enabling interconnection between modules. In 2023, EMS 2.0 became the company's main product, and completed the dual upgrade of the product model (platform superposition industry application) and sales model (design institute promotion and development system agent). We believe that with the continuous construction of new energy power supplies and energy storage on the user side and the gradual deepening of power market-based reforms, the management needs of user-side microgrids will become more and more complex. The platform-based and intelligent advantages of EMS 2.0 are expected to be highlighted rapidly, and we are optimistic about revenue growth throughout 2024.
Pay attention to new energy+overseas opportunities, and there is plenty of room for long-term growth
The company attaches great importance to the two major opportunities of new energy+ going overseas. 1) New energy: The company attaches importance to the efficient utilization needs brought about by the growth of new energy sources on the user side. In 23, it built an integrated optical storage and charging platform and EMS 3.0 products (EMS 2.0+ optical storage and charging +AI smart strategy). In April '23, Ancree's first orderly charging operation station was completed in Jiangyin; 2) Going overseas: the company attaches importance to overseas business opportunities and actively develops business layouts in Southeast Asia, Europe, the Middle East, Africa, North America, etc. In April '23, the company's sales and technical team went overseas to participate in industry exhibitions and establish multi-party cooperation; in April '23, the company went to Germany to participate in Hanno The Weihai Industrial Fair continues to strengthen its overseas layout. We believe that new energy+ offshore is expected to contribute new momentum to the company's performance growth.
Risk warning: New power system construction falls short of expectations; platform products fall short of expectations.