Core views:
Changes in fair value in 23 years dragged down net profit to mother. The company released its annual report and quarterly report. In 2023, it achieved operating income of 1,864 million yuan, +20.31% year on year; net profit to mother was 607 million yuan, -5.27% year over year. 23Q4 revenue was 467 million yuan, +4.87% year over year; net profit to mother was 175 million yuan, +30.94% year over year; 24Q1 achieved operating income of 491 million yuan, +11.48% year over year; net profit to mother was 139 million yuan, +1.88% year over year. The net profit returned to mother in '23 was mainly affected by changes in the fair value of Lianying Medical shares held by the company. In '22, the profit from the change in fair value of Lianying's stock was about 120 million yuan, and the fair value of Lianying's stock lost about 80 million yuan in '23.
Gross margin grew steadily in '23, and declined in 24Q1. The company's gross profit margin in '23 was 57.84%, +0.50pct year on year; core product detector gross profit margin was 61.12%, +2.15pct year on year. 23Q4 gross profit margin 55.27%, year-on-year +0.81 pct; 24Q1 gross profit margin 53.33%, year-on-year -3.71 pct.
Revenue from new products is growing rapidly, and sensor design and process technology layout continue to be improved. In '23, the company completed the basic layout in the field of new core components such as high voltage generators, radiation sources, and ball tubes. The revenue scale was nearly 100 million yuan, which more than doubled over the previous year. Product revenue using new sensor technologies such as CMOS, IGZO, and flexibility exceeded 415 million yuan in '23.
Ray tubes continue to break through, and plans are being made to expand the production of X-ray vacuum devices. According to the annual report, the company entered mass production of three microfocus closed ray tubes, 90kV, 130kV, and 150kV, and completed research and development of 180kV microfocus closed ray tubes, breaking the situation where products of the same type in this field are monopolized by imported equipment.
According to the April 29 announcement, the company plans to issue shares to specific targets to raise no more than 1.45 billion yuan for X-ray vacuum device and integrated solution construction projects. After the project is completed, the company will increase production capacity for 77,000 tubes and 19,300 sets of X-ray integrated solution products.
Profit forecasting and investment advice. We expect the company's net profit to be 884/11.27/1,422 million yuan for 24-26, respectively. Referring to comparable companies, the 2024 30xPE is given, corresponding to a reasonable value of 260.12 yuan/share, maintaining a “buy” rating.
Risk warning. Medical industry policy risks; industry competition increases risk; risk of high customer concentration in some fields; risk of falling short of expectations in the dental and industrial sectors.