Incident: Domestic energy storage won the bid of 5.05 GW/15.9 GWh in April '24, +64%/+104%; domestic energy storage won the bid for 15.9 GW/42.8 GWh from January to April '24, +150%/+141% compared to the same period. Downstream demand for energy storage is strong.
Domestic demand for energy storage is strong, and the company's shipments as a leading energy storage battery manufacturer continue to increase. As a leading domestic energy storage cell manufacturer, Everweft Lithium Energy is expected to continue to increase in energy storage battery shipments, benefiting from increased downstream demand. 24Q1's energy storage battery shipments were 7.02 GWh, +113% year-on-year. According to Xinyi information data, in March 2024, the company ranked second in domestic energy storage cell shipments, accounting for 18.7%. Considering strong downstream demand, we expect the company's Q2 energy storage battery shipments to reach 12-13 GWh, +70% month-on-month. The company's energy storage capacity is currently at full capacity. Considering the adjustment and optimization of the order structure, there is room for price improvement, and profitability is expected to gradually increase.
Power shipments have been rising steadily, and the position in the industry continues to improve. According to GGII data, the company's share of domestic power battery installed capacity in 21-23 was 1.6%/2.4%/3.1%, respectively, and increased to 4.2% in January-April '24, and its position in the industry continued to improve. The company's customers include passenger car customers such as GAC Passenger Vehicle, Hezhong, and Xiaopeng. It also excels in the commercial vehicle field, supplying batteries for Geely Commercial Vehicles, Nanjing Jinlong, and Valin Xingma. The 24Q1 company ranked second in the domestic loading volume of new energy commercial vehicles, with a market share of 16.05%. We expect the company's Q2 power shipments to be 7-8 GWh, or more than +10% month-on-month.
Consumer tools are in high demand, and the company's small cylinder shipments are increasing. Demand from tool companies such as Quanfeng Holdings and Glibo reached an inflection point in '24. As a leading consumer cylinder company, production capacity continues to be at full capacity, and the monthly shipment volume for Q2 is expected to be 90-1 million units. The company continues to lay out overseas bases, the Malaysian factory is under construction, and the long-term development of the consumer business can be expected.
Investment advice: Considering the rapid development of the company's power storage consumption business, we expect the company to achieve net profit of 52.91/63.22/7.629 billion yuan in 2024-2026, +30.6%/+19.5%/+20.7% year-on-year, corresponding EPS of 2.59/3.09/3.73 yuan, maintaining a “buy” rating.
Risk warning: downstream demand falls short of expectations; SMORE's performance falls short of expectations; industry competition intensifies.