2023&2024Q1 performance: In 2023, the company achieved revenue of 3.251 billion yuan, +43.5% year on year, net profit to mother of 179 million yuan, +75.7% year on year, net profit after deduction of 370 million yuan, +262.5% year on year; 2024Q1, the company achieved revenue of 863 million yuan, +22.2% year on year; net profit to mother of 125 million yuan, +70.7% year on year.
The 2023 charging pile business layout ushered in a harvest period, and 24Q1 continued to grow at a high rate. In 2023, the company's new energy charging pile business achieved revenue of 567 million yuan, an increase of 493.21% over the previous year. The high growth rate continued in 24Q1, and the charging pile business achieved revenue of 160 million yuan, an increase of 103.33% over the previous year. In 24Q1, the company's comprehensive gross margin rebounded to 56.72%, mainly due to a steady increase in the gross margin of the charging pile business. According to the company's investor relations activity records, the main reasons for the increase in the gross margin of the charging pile business are:
1) The production capacity layout of overseas factories has been optimized, and tariff costs have been reduced compared to the same period last year. 2) The company has strengthened the fine control of logistics and reduced logistics costs. 3) Increased share of revenue from DC piles with higher gross margins.
The wave of automobile electrification has brought about a huge gap in charging piles, and the European and American markets are expected to accelerate volume. The construction of charging stations in Europe and the US is still in its infancy, and the construction speed is seriously lagging behind the growth rate of NEV sales. According to data disclosed by the IEA, the ratio of US and European car piles reached a high level of 19.66/34.41 respectively in 2023, while the ratio of new energy bus piles in China was 9.73 in 2023. Compared with Europe, the US and China, the construction progress of charging piles is far behind, and the demand gap is obvious. As countries' subsidy policies continue to advance, the European and American charging pile markets are expected to rapidly expand.
The company's DC overcharging products have reached the top of the industry, breaking through the world's leading customers. In 2023, the company released three important products, high-power overcharging piles, small DC piles, and commercial AC piles, covering a power range of 20-640KW. In January '24, the company launched its flagship product, the DC overcharger MaxiCharger dChiPower, at the Las Vegas International Consumer Electronics Show. It became the industry leader with a maximum charging power of 640 kW, with a single gun output power of 480 kW, marking a major breakthrough in the field of overcharging. The product is equipped with top liquid cooling technology combined with Daotong's patented AI matrix algorithm energy efficiency optimization to significantly reduce costs and improve site performance. In addition, the company has also launched three major products: a charging pile operation management platform, a charging pile operation and maintenance management platform, and a charging pile app application to provide customers with intelligent charging management. The company successfully signed contracts with many of the world's top 50 large enterprise customers in 2023, and strategic customer reserves showed exponential growth.
The overseas production and sales layout is perfect. The company has long been deeply involved in overseas markets and has rich experience in global layout. The sales network has covered more than 70 countries or regions around the world, including North America, Europe, China, Asia Pacific, South America, and IMEA (India, Middle East, Africa), and has initially formed an integrated global marketing network. Furthermore, the company has established localized production capacity in the US and Vietnam, which can effectively avoid international trade risks while reducing tariff costs.
Investment advice: The company's revenue for 2024-2026 is estimated to be 38.56/48.56/5.789 billion yuan, respectively, and net profit to mother is 492/6.99/823 million yuan, respectively, maintaining the “buy” rating.
Risk warning: Global NEV growth is slowing down, demand in the traditional vehicle diagnostic market is slowing down, European and American charging pile construction is falling short of expectations, market competition is intensifying, and there is a risk of exchange rate fluctuations.