occurrences
The company released its annual report for 2023 and the first quarter of 2024, and the performance was in line with our expectations. In 2023, we achieved revenue of 5.957 billion yuan, +39.67% year over year; realized net profit of 913 million yuan, +40.84% year over year; realized net profit without deduction of 876 million yuan, +45.15% year over year. In Q4 2023, we achieved revenue of 1,723 billion yuan, +39.05% year over month; realized net profit of 316 million yuan, +30.94% year over month, 56.52% month on month; realized net profit without return to mother of 287 million yuan, +39.38% year on year, +44.18% month on month. In Q1 2024, we achieved revenue of 1,642 billion yuan, +30.69% year over month; realized net profit of 232 million yuan, +36.92% year over year, -26.57% month on month; realized net profit without return to mother of 221 million yuan, +44.86% year over year, and -22.79% month on month.
Product structure continues to be optimized, and new energy is the main driving force
The company has seized the opportunity of rapid growth in domestic NEV production and sales and continues to enrich and optimize product categories. At present, the company has basically achieved full coverage of automotive aluminum alloy high-pressure die-casting products such as NEV three-electric systems, automotive structural parts, thermal management systems, and intelligent driving systems. In terms of order acquisition, in 2023, the company's new energy related projects in the aluminum alloy die-casting sector accounted for about 90% of the total fixed target ratio; of these, new energy body structural parts accounted for about 30%, new energy three-electric systems accounted for about 40%, and intelligent driving and thermal management system projects accounted for about 10%. In terms of revenue share, the company's sales revenue for NEV products in 2023 accounted for about 30%, an increase of 10 pcts over the previous year. Looking forward to the future, the company aims to achieve more than 30% of sales of new energy products by 2025 and 70% by 2030.
Production capacity has been released at an accelerated pace around the world, and the early layout has ushered in the harvest period. Currently, the company has built several production bases in Ningbo, Zhejiang, Liuzhou, Guangxi, Maanshan, Mexico, etc., and plans to invest in the construction of die-casting production bases in Hungary. Among them, the first phase in Mexico was fully put into mass production and use in July 2023, and the second phase of the Mexican plant (production base for structural parts and tri-electric system components for new energy vehicles) is scheduled to be put into production in 2025. The first phase plant at the Maanshan production base in Anhui (leading products are integrated die-cast structural components for power and energy storage battery trays) was put into mass production in 2023.
Investment advice and profit forecasting
We expect the company's 2024-2026 revenue to be 75.81\ 96.53\ 11.965 billion yuan, respectively, and net profit to mother will be 10.80\ 13.65\ 1,696 billion yuan respectively. According to the latest current share capital estimates, the corresponding basic earnings per share will be 1.20\ 1.52\ 1.89 yuan, respectively. According to the latest stock price, it is equivalent to 16\ 13\ 10 times PE. Considering the company's technical barriers in the aluminum alloy die-casting process and higher profit levels than the industry average, we are optimistic about the company's medium- to long-term growth space and maintain a “buy” rating.
Risk warning
Market competition increases risk, gross margin decline risk, raw material price increase risk, export business and overseas business risk.