Core views
The company's first-quarter results exceeded expectations, benefiting from mass production of incremental customer projects such as Cyrus, and the company's Q1 revenue grew slightly month-on-month (not weak in the off-season); factors such as OEM price pressure and depreciation, which were feared by the early market, did not significantly suppress the company's gross margin. Q1 gross margin improved year-on-year, cost ratio pressure dropped during the period, and net interest rate increased year-on-month. The company has strong ability to expand its business horizontally. Platformization and internationalization strategies continue to advance, and new businesses such as electromechanical actuators are expected to open up new medium- to long-term growth space.
occurrences
The company announced its quarterly report for the year 24, achieving revenue of 5.69 billion yuan, +27.3%, +2.51% month-on-month, and realized net profit of 645 million yuan, +43.3% year-on-year, +16.7% month-on-month, net profit of 596 million yuan after deducting non-return to mother net profit of 596 million yuan, +41.8% year-on-year and +14.5% month-on-month.
Brief review
Benefiting from mass production of incremental customer projects such as Cyrus, the company's Q1 revenue increased slightly from month to month.
The first quarter was generally a low season for traditional automobile consumption. In Q1, the company's current revenue was -30% month-on-month. The company's current revenue bucked the trend or was mainly due to the volume of incremental supporting model projects such as the M7/M9. Among them, Quanjie's current production reached 86,000, +6 times year over year; Ideal Car's current production reached 101,000, +92% year over year; major customer Geely Group (including krypton) current production was +46% year on year; North American major customer output was -1.7% YoY; Shanghai factory output ratio was +2.3% YoY.
Gross margin improved year on year, expense ratio pressure dropped during the period, and Q1 net margin increased year on month.
The 24Q1 company's gross margin was about 22.43%, +0.58pct year over year, -0.13pct month-on-month, and pressure such as OEM price pressure and depreciation (23Q4 and 24Q1, respectively, fixed about 21.8 billion yuan and 360 million yuan, respectively) did not significantly suppress the company's gross margin; the increase in revenue scale combined with cost control drove the company's expenses ratio to 9.32%, -0.79pct year on year, -0.05pct; in addition, asset impairment and credit impairment losses were drastically reduced month-on-month (23Q4 concentrated) Chinese (Yuntong and Weimar's bad debt provision) jointly promoted the company's current net interest rate to reach 11.35%, +1.27 and +1.38pct, respectively, compared with the same period last month.
The company's platformization and internationalization strategy continues to advance, and the new business layout is progressing steadily.
1) The overall competitiveness of interior functional parts, lightweight chassis, and thermal management businesses continues to improve, and sales are growing rapidly. Revenue from the interior parts, chassis systems, and thermal management business in '23 was about 6.58 billion yuan, 61.2 billion yuan, and 1.55 billion yuan respectively, respectively; 2) The automotive electronics business ushered in a harvest period. Projects such as closed suspension, IBS, and EPS were gradually mass-produced and implemented, and emerging projects such as electric drive systems progressed smoothly. For the first time, it was disclosed that the revenue of the electric drive system (robot actuator) in '23 was 1,854 million yuan, with a gross profit margin of 81.25%.
Investment advice: The company has strong ability to expand its business horizontally, and has advantages in production capacity, technology and customer resources. New businesses such as mechanical and electrical actuators are expected to open up new growth space in the medium to long term. The company's net profit for 2024-2025 is estimated to be about 2,768 billion yuan and 3.559 billion yuan, respectively, +28.7% and +28.6% year-on-year, corresponding to PE of about 25.1 and 19.5 times, respectively, maintaining the “buy” rating.
Risk warning: Industry sentiment falls short of expectations, industry competition deteriorates, raw material prices fluctuate sharply, new customer expansion and production capacity investment fall short of expectations.