occurrences
The company released its 2024 annual report. According to the announcement, the company achieved revenue of 1,159 million yuan in 24, an increase of 8.71%; net profit to mother was 256 million yuan, an increase of 32.48% year on year; net profit after deducting non-return to mother was 239 million yuan, an increase of 29.58% year on year. Gross profit margin 39.61%, net profit margin 22.06%.
In 24Q1, the company achieved revenue of 335 million yuan in a single quarter, up 15.28% year on year and 10.08% month on month; net profit to mother was 0.72 million yuan, up 8.98% year on year, up 7.46% month on month; net profit after deducting non-return to mother was 68 million yuan, up 5.09% year on year and 15.25% month on month. Gross profit margin 37.91%, net profit margin 21.33%.
Q1 Performance increased month-on-month, and downstream demand continued to improve
The company achieved a month-on-month increase in revenue and profit in 24Q1, mainly due to the rapid growth of magnetic inductor components while the company maintained steady growth in metal soft magnetic powder cores. Benefiting from the rapid development of artificial intelligence, AI servers, new energy vehicles, etc., the company's magnetic inductor components continued to grow rapidly in the second half of 2023, and sales growth was further expanded, and revenue achieved rapid month-on-month growth, accounting for a significant increase in the company's revenue. With the rapid growth of the company's magnetic inductor products, the company's product system and revenue structure will be further improved, which can effectively iron out the impact of cyclical fluctuations in some downstream industries on the company's overall business performance and development speed. At the same time, since sales repayments for inductive components are mainly settled in cash, the company's operating cash flow will be significantly improved.
Chip inductors are used in many of the world's leading GPU chip manufacturers, and are expected to maintain rapid growth. The company's chip inductors have shown strong product competitiveness. Through approval and cooperation with semiconductor and system solution providers such as MPS and Infineon, the products have been ordered in batches and used in many of the world's leading GPU chip manufacturers, and sales revenue has grown rapidly from quarter to quarter. According to the company's current orders and downstream market information, in addition to the demand for mass-produced projects that have already been mass-produced, several projects under development will also achieve mass production one after another, so chip inductors are expected to continue to grow rapidly in 2024, bringing strong impetus to the company's development.
Soft magnetic powder core products have been upgraded again, and market recognition continues to increase. As global photovoltaic inverter inventory removal progresses, the company continues to optimize and upgrade the two major NPC/NPV series, and successfully developed the GPV/GPC series, which will be introduced to the market in 2024, greatly enriching the company's metal soft magnetic powder core product line. Furthermore, the iron silicon 5 generation magnetic powder core to be developed by the company has made breakthrough progress in the laboratory. Its loss characteristics have been further reduced by about 50% compared to the iron silicon 4 generation, which can meet the market demand for higher frequency trends, and will further consolidate the company's leading performance position in the metal soft magnetic powder core industry.
Investment advice
We maintain our previous profit forecast. We expect the company's net profit to be 3.57/476/556 million yuan from 2024 to 2026, respectively, corresponding PE of 31.43/23.55/20.14 times, maintaining the “buy” rating.
Risk warning
Raw material prices fluctuated, production expansion fell short of expectations, and downstream demand fell short of expectations.