Key points of investment
Short-term drive: exports of medium- and low-power systems increase, high-power system+cutting heads open up the thick plate cutting market
① Medium and low power systems: Domestic business is highly correlated with the sentiment of the manufacturing industry. We judge that the domestic manufacturing industry has maintained steady growth in the context of weak recovery; the export portion has benefited from the “Group Overseas Plan” of laser industry equipment vendors to achieve rapid breakthroughs in low power systems following equipment vendors going overseas. ② High power system:
The penetration rate of laser cutting of thick plates such as downstream steel structures and ships continues to increase, and the market size continues to expand.
③ Intelligent cutting head: Performance is comparable to overseas leaders, leading the market in terms of intelligence. The combined advantages of high-power system+intelligent cutting head continue to expand, and the company's share is rapidly increasing.
Mid-term drive: Breakthrough in the industrialization of intelligent welding. The company's high technical barriers are expected to be the first to benefit from teaching-free intelligent welding without manual programming and teaching. Through sensor recognition and automatic programming, it adapts to non-standard, small-batch welding, solving the pain points of non-standard welding in steel structures and other industries, and is expected to open up market space for welding robots. The company has achieved welding of new components such as penetration welding testing of box-shaped column main welds, cylindrical joints, and continuous welding of any curve. Various components such as L-shaped, triangular, and crescent swinging movements have been added to gradually break through the barriers of the welding process. In April 2024, Honglu Steel has successively issued tender notices for 2000 sets of components related to intelligent welding robots. Industrialization has already been implemented, and we judge that the company is expected to be the first to benefit as a strategic partner of Honglu Steel.
Long-term drive: Based on the commonality of underlying technologies, expanding categories across fields to achieve borderless expansion. The company continues to increase investment in basic platform capacity building based on the five core technologies independently developed. On the one hand, the company continues to increase R&D investment to maintain technological leadership, and on the other hand, the sinking terminal market ensures the certainty and profitability of business implementation. Based on the above construction, the company has the ability to expand across fields and has a long-term growth logic. The fields that the company has now laid out include precision processing of semiconductors and new energy sources, integrated high-precision drive control, etc., continuously opening up room for long-term growth.
Profit forecast and investment rating: We maintain the company's 2024-2026 net profit forecast of 1,040/13.77/1,775 billion yuan. The current market value corresponds to PE of 39/29/23 times, and maintains a “buy” rating.
Risk warning: declining profitability, falling short of expectations in the industrialization of new products, increased competition, etc.