The company's revenue in 2023 was 8.938 billion yuan, +7.23% year on year, gross profit margin of 31.17%, +0.89pct year on year, net profit to mother was 1,513 billion yuan, +11.09% year on year, net profit after deducting non-return to mother was 1,408 billion yuan, +11.36% year over year. Q4 revenue was $2,856 million, +11.02% year on year, gross profit margin 32.44%, +1.34pct year on year, net profit to mother was 559 million yuan, +27.16% year over year, net profit after deducting net profit of 531 million yuan, +35.8% year on year.
The company's 2024Q1 revenue was 2,584 billion yuan, +38.34% year over year, net profit to mother was 515 million yuan, +157.03% year over year, net profit after deduction was 497 million yuan, and +172.02% year over year. The gross profit margin was 33.86%, +8.13pct year over year and +1.42pct month-on-month.
AI and other related businesses have achieved high growth and continued to expand production capacity to meet strong demand. The company's corporate communication board revenue in 2023 was 5.87 billion yuan, +6.82% YoY, gross profit margin 34.51%, +0.18pct YoY. Among them, AI+HPC-related revenue reached 1.24 billion yuan, a significant increase of +186% year over year, thus driving the entire sector to grow against the trend. Faced with the strong demand brought about by AI, the company decided at the beginning of '24 to invest 510 million yuan to carry out technical reforms for high-density high-speed interconnect PCB projects for computing power networks.
The automotive board business grew steadily, and Shengweiche's losses narrowed. The company's automotive board business revenue in 2023 was 2.558 billion yuan, +13.74% year over year, gross profit margin 25.65%, +1.6 pct year on year. Among them, the share of emerging automotive board products further increased, reaching 25.96%, or 4.51pct compared to the previous year. The company completed the acquisition of Shengweize's P2Pack technology in May 2023. Since the technology is still in the early stages of development, Shengweiche lost about 191 million yuan in 2023, affecting the sector's gross margin of about 2.21pct. The 2023Q4 is a product used in 48V light hybrid systems to achieve mass production.
The share of overseas revenue has further increased, and construction of the Thai plant has been accelerated. Overseas business revenue in '23 was 7.218 billion yuan, +14.67% year on year, accounting for 80.75%, or +5.24pct year on year. The gross profit margin was 34.85%, +1.31pct.
The first phase of the Thai plant plans to invest 1.4 billion yuan. By the end of 23, the project progress will reach about 27%, and 23H1 will be 9.5%.
The sales, management, and financial expenses rates in 2023 were 3.13%, 2.19%, and -0.76%, respectively, -0.14 pct, +0.24 pct, and +0.87 pct, respectively. R&D expenses were 539 million yuan, +15% year over year. The corresponding cost ratio was 6.03%, +0.41 pct year on year.
Profit forecasting and investment advice. We expect the company's revenue for 2024-2026 to be 11.192 billion yuan, 13.779 billion yuan, and 16.57 billion yuan, respectively, with net profit attributable to mother of 2.115 billion yuan, 2,741 billion yuan, and 3.415 billion yuan, corresponding EPS of 1.11 yuan, 1.43 yuan, and 1.78 billion yuan. Referring to comparable company valuations, the company was given 30-35 times PE in 2024, corresponding to a reasonable target price of 33.16 yuan - 38.69 yuan, maintaining a “superior to the market” rating.
Risk warning. Market competition intensified; AI business development fell short of expectations; prices of upstream raw materials increased.