Overall operation in '23 & 24Q1 was steady, and the share of overseas revenue increased year by year. The company achieved revenue of 6.754 billion yuan, +23.30% year over year; net profit to mother of 629 million yuan, +33.13% year over year; 24Q1 achieved revenue of 1,831 billion yuan, +17.32% year over year; and net profit to mother of 139 million yuan, -13.96% year over year. Considering that the company is in a development period in foreign markets and is continuously increasing investment in new product development, we raised the company's cost rate assumption; considering that demand in some downstream markets is weak, we lowered the revenue growth assumption. The company's corresponding EPS for 24-26 years is 1.63/2.02/2.47 yuan, respectively (the value was 1.91/2.55 yuan 24-25 years ago). Referring to the consistent expectations of the comparable company Wind, the 24-year average PE was 19 times, giving the company 19 times the 24-year PE, corresponding to a target price of 30.52 yuan (previous value 43.20 yuan), maintaining a “buy” rating.
24Q1 gross margin increased steadily, and net profit after deducting non-return to mother increased 24Q1's net profit by 139 million yuan, or -13.96%/-5.56% month-on-month; net profit after deducting non-return to mother was 122 million yuan, +25.62%/+151.81% month-on-month. The 24Q1 gross margin was 25.91%, +1.35pct month-on-month; net margin was 7.70%, -0.15pct month-on-month. In terms of cost rates, 24Q1 company's sales/management/R&D/finance expenses rates were 4.37%/3.03%/11.54%/0.12%, respectively, with a month-on-month change of -1.06/-0.50/-1.68/-0.65pct.
Continue to strengthen platform construction and further promote two-way efforts
The company focuses on power electronics and related control core technology, and continues to expand into intersectional fields and emerging fields related to core technology. In 23 years, the new business has been developing smoothly, mainly core components for photovoltaics, energy storage & charging piles, electrified construction machinery products, thermal management components for new energy vehicles, and power supplies for office automation equipment. In '23, the company achieved revenue of 6.754 billion yuan, +23.30% year-on-year. Among them, smart home appliance electronic control products/ power products/ new energy and rail transit components/ industrial automation achieved revenue of 26.19/21.22/7.10/584 million yuan respectively, +25.27%/+12.62%/+34.85%/+53.69% compared with the same period last year.
Aiming at new opportunities to go overseas, overseas revenue accounted for about 40% in '23
In terms of overseas market expansion, the company is increasingly improving its global “R&D+manufacturing+sales” network. It has overseas market certifications and qualifications in various fields, and has invested in production capacity construction in Thailand, India and the United States.
In '23, the company achieved direct overseas revenue of 1,951 billion yuan, accounting for 28.88% of the company's total revenue; indirect overseas revenue accounted for about 11% of the company's total revenue, and the company's share (direct+indirect) of total revenue generated by supplying overseas demand in '23 reached about 40%.
Risk warning: Due to macroeconomic fluctuations, the speed of commissioning of new production capacity falls short of expectations, and gross margin falls short of expectations.