Event: The company revealed the 2024 semi-annual performance forecast: 2024H1 is expected to achieve revenue of 26.50 to 2.84 billion yuan, +35% to +45% year over year; realized net profit to mother of 3.58 to 0.385 billion yuan, +30% to +40% year over year.
Business performance has been steady, and mass production of new products has been accelerated. 2024H1 is expected to achieve revenue of 26.50 to 2.84 billion yuan, +35% to +45% year over year; realized net profit to mother of 3.58 to 0.385 billion yuan, +30% to +40% year over year.
Among them, 2024Q2 is expected to achieve revenue of 12.33 to 1.423 billion yuan, +17.65% ~ +35.78%, and -12.99% ~ +0.42% month over month; realized net profit of 1.39 to 0.166 billion yuan, -3.47% ~ +15.28% year over month, and -36.53% to -24.20% month-on-month, due to changes in revenue and performance. We think the main reason is: 1) The year-on-year increase in revenue, mainly benefiting from the accelerated pace of mass production of new products; 2) There is slight pressure on performance from month to month. It is estimated to be due to a slight drop in sales volume of the company's main customer, the domestic Volkswagen 24Q2 sales volume of 0.6155 million vehicles, -17.23% year over month, and -5.03% month over month, of which SAIC Volkswagen 24Q2 sold 0.264 million vehicles, -4.67% year on year, +6.44% month on month; FAW-Volkswagen 24Q2 sales volume 0.2689 million vehicles, -24.68% year on month and -12.15% month on month.
Focus on low-level drive control technology; automotive electronic standards are scarce. The company is one of the few Chinese companies that have penetrated the global high-end car brand system and carried out simultaneous research and development of automotive electronics products. The company focuses on execution-level control technology. It currently has LED lighting control, motor control, energy management, vehicle appliances and electronics, intelligent driving, etc., with more than 100 kinds of products. The end users mainly include dozens of world-renowned automakers such as Volkswagen Group, Daimler, Jaguar Land Rover, FAW Group and SAIC Volkswagen.
From lighting control to domain control, transformation into a platform-based automotive electronics supplier. The company is a scarce domestic supplier of automotive electronics. It has both software and hardware capabilities, and is also good at electronic control system products, ECUs and other end actuators, and has strong horizontal product extension capabilities. Electric intelligence transformation will accelerate the centralization of vehicle electronic and electrical architectures and catalyze the development of domain controller business. Currently, there are few domestic players, and the competition is mainly foreign tier 1. The company's early strategic layout of domain control has now obtained fixed points such as vehicle body area, chassis domain, smart driving domain, etc., and has become a platform-type electronic supplier that can simultaneously integrate central controllers to terminal sensors and actuators. In 2023, body domain controller and chassis domain controller products have been mass-produced and delivered one after another. It is expected that subsequent companies will continue to advance to the next level in terms of product depth and breadth. At the same time, the company is steadily advancing the launch of its first overseas factory in Japan, accumulating experience in international operation, and accelerating the global layout.
From binding to the public to the full blossom of new energy sources, we have followed the growth of core electrification customers. Client, the company adheres to the big customer strategy, from binding Volkswagen to the full blossoming of new forces. It has now basically completed the market layout of leading domestic and foreign NEV companies. The market has covered VW Group's MEB and PPE platforms, BYD, Tesla, Ideal, NIO, Xiaopeng, Geely, Great Wall, Changan, Dongfeng and other customers. It is expected that in the future, it will continue to strengthen supply categories and depth of cooperation with key customers to follow the growth of electrification core customers.
Investment advice: The company is a leading domestic automobile controller company with an improved product and customer structure, and is expected to benefit from intelligent electrification in the long term. We expect the company's revenue for 2024-2026 to be 6.431/7.865/9.862 billion yuan, net profit to mother 0.843/1.089/1.405 billion yuan, corresponding EPS 2.09/2.70/3.48 yuan, corresponding to the closing price of 53.57 yuan/share on July 16, 2024, PE is 26/20/15, respectively Double, maintaining a “recommended” rating.
Risk warning: The progress of domain control products falls short of expectations; the expansion of non-mass customers falls short of expectations; progress of new products such as Ambient Light, AGS, Guol6, and USB falls short of expectations; industry competition intensifies; and raw material costs have increased.