Key points of investment

3C product sales continued to break through, and FY23's performance grew steadily

In 2023, the company achieved revenue of 4.840 billion yuan, an increase of 0.59% over the previous year, and achieved net profit of 390 million yuan, an increase of 17.80% over the previous year. The company continues to consolidate its advantages in the 3C field, deeply bind major customers, and achieve breakthroughs in flexible automated production line sales, driving 23 years of performance growth. The 24Q1 company achieved revenue of 743 million yuan, a year-on-year decrease of 15.88%; net profit to mother of -021 million yuan, which changed from profit to loss over the previous year. 24Q1 performance is under pressure in the short term, mainly due to the impact of the 3C project cycle being advanced, costs ahead, and the equipment not yet entering the acceptance period.

Deeply cultivate the 3C industry, expand vertically and continue to develop

The company is deeply involved in the 3C industry. From the perspective of the consumer electronics industry chain production chain, the company's equipment can now not only be used in the assembly and testing of terminals, but has also been extended vertically to the assembly, inspection, measurement, and testing of front-end components and module segments.

Flexible automated production line: At present, this flexible automated production line has been successfully mass-produced, and more than 40 production lines have been delivered to clients, which is progressing smoothly. At the same time, the company has received proofing requests from clients for flexible automated production lines for the next year, and is currently undergoing intense proofing.

XR equipment: The company has received proofing requests from major customers for second-generation MR production equipment and is currently in a proofing state. As subsequent companies continue to expand vertically and expand customers and markets, the company's business in the consumer electronics field is expected to continue to grow.

Actively lay out new fields and open up room for growth and imagination

Semiconductor sector: In terms of eutectic mounters, the company's new product, the company's new product, the Xingwei EH9721, has now received 400G/800G batch orders from well-known companies in the industry. In terms of high-speed and high-precision crystal soldering machines, currently the crystal fixing machines that meet the needs of major customers are still in the installation stage; in terms of AOI testing equipment, a new generation of products has been developed.

Instrumentation: The subsidiary Bozhong Instrument completed the development of an engineering prototype in July 2022, obtained application verification, and then developed the second-generation transmission electron microscope product BZ-F200. Its performance indicators are comparable to those of similar overseas electron microscopes, and the first commercial product is about to be delivered.

Low-altitude economy: The low-altitude economy business is carried out by the subsidiary Bozhong Robotics. The main product is an open space integrated global cruise information sharing system, which provides government and enterprise customers with large-scale, large-scale comprehensive solutions for normalized global low-altitude inspection. Currently, the company is cooperating with the local government to plan and build an integrated unmanned sensing system for open space.

The company actively expands business in new fields and opens up room for imagination for future growth.

Profit forecasting and valuation

We expect the company's 2024-2026 revenue to be $59.4, 71.8, and 7.78 billion yuan, respectively, with year-on-year growth rates of 22.8%, 20.8%, and 8.4%; net profit to mother will be 5.2, 6.5, and 7.2 billion yuan, respectively, with year-on-year growth rates of 33.0%, 25.4%, and 9.9%, respectively, corresponding to PE of 17, 14, and 13 times, respectively, maintaining the “buy” rating.

Risk warning

Consumer electronics industry recovery falls short of expectations, semiconductor equipment expansion falls short of expectations, etc.