On July 15, the company released the 24H1 interim report performance forecast. The company's 24H1 estimated net profit of 0.61-0.68 billion yuan, +19.90% to 33.65% year over year, and estimated net profit of 0.59-0.66 billion yuan before deducting non-return to mother, +18.96-33.07% year on year. For Q2, net profit due to mother is estimated to be 0.301-0.371 billion yuan, -2.3% ~ +20.4% month-on-month, and net profit without return to mother is 0.295-0.365 billion yuan, or -0.2% to +23.5% month-on-month.
1. 24H1 profit growth is in line with expectations. On the demand side, 24H1 domestic power+other battery production was +37% year-on-year, maintaining a high increase, taking into account: ① the annual decline in products in Q1; ② the rise in raw materials such as copper and aluminum in H1 (the average price of aluminum/copper Q2 increased by about 8%/15% month-on-month, which adversely affected gross margin); ③ the Q2 operating rate is expected to increase compared to Q1, consolidating profitability. The company's overall profit growth is still in line with expectations, and profit margins remain strong.
2. 24H2 outlook: The industry may face competition, and the company is expected to consolidate its performance through continuous lean management. The market may be worried about structural parts facing downward price pressure. The company has an industry-leading customer structure, management & production efficiency, and is expected to cope with the impact of price cuts through diversified customer distribution and internal production management optimization. Furthermore, the company has deployed harmonic speed reducers, etc., to start a second growth curve, which is expected to gradually increase overall profits in the future.
As a global leader in structural components, Kodaly continues to maintain its leading position with leading technology, strong customer stickiness, and ability to reduce costs. Its profit stability has been verified by performance and continuously recommended. We expect the company's net profit to be 1.42, 1.66, and 1.9 billion yuan in 24-26, corresponding EPS of 5.3, 6.1, and 7.0 yuan, respectively, corresponding to PE 15, 13, and 11X, maintaining a “buy” rating.
Demand for downstream new energy vehicles and energy storage fell short of expectations, prices of raw materials rose, prices of industry products exceeded expectations, and major shareholders reduced their holdings.