The company released its 2024 semi-annual report. 2024H1 performance increased 0.02% year on year. The charging pile business maintained a good growth trend, and the energy storage business was affected by overseas interest rates, and the growth rate slowed down. If overseas interest rates loosen in the future, the company may usher in a double inflection point in revenue growth and profitability. Maintain an increase in holdings rating.
Key points to support ratings
The company's performance in the first half of 2024 increased 0.02% year on year: the company released its 2024 semi-annual report. In the first half of 2024, the company achieved revenue of 1.431 billion yuan, an increase of 29.84% year on year; realized net profit of 0.181 billion yuan, an increase of 0.02% year on year; realized deduction of non-net profit of 0.173 billion yuan, an increase of 1.77% year on year.
Among them, 2024Q2 achieved net profit of 0.115 billion yuan to mother, a year-on-year decrease of 3.12% and a year-on-month increase of 73.57%. 2024H1, the company's comprehensive gross margin fell 1.96 percentage points year on year to 39.57%, and the comprehensive net margin fell 3.94 percentage points year on year to 12.53%.
The charging pile business grew rapidly, and gross margin declined slightly: 2024H1's electric vehicle charging equipment business achieved revenue of 0.556 billion yuan, an increase of 44.83% over the previous year. Gross margin decreased slightly by 1.39 percentage points year over year to 38.07%. According to statistics from the Charging Alliance, 2024H1 added 1.647 million domestic charging infrastructure, an increase of 14.2% over the previous year, driving the company's demand for charging equipment products.
The revenue growth rate of the energy storage business slowed, and gross margin was under pressure: 2024H1, the company's new energy power conversion equipment business achieved operating income of 0.465 billion yuan, an increase of 19.59% year on year; gross margin fell 5.63 percentage points year on year to 30.01% year on year. We believe that demand in overseas markets for 2024H1 was suppressed by higher interest rates, which led to a slowdown in sector revenue growth. At the same time, due to changes in domestic and overseas revenue structures, the sector's gross margin also declined. If overseas interest rates loosen in the future, the revenue growth rate and profitability of the company's energy storage business may be expected to reach an inflection point.
The industrial supporting power supply and battery manufacturing and testing business has developed steadily: 2024H1, the company's industrial power supply business achieved operating income of 0.251 billion yuan, an increase of 17.38% year on year, and gross margin increased 1.05 percentage points to 54.73% year on year; battery chemical and testing business achieved operating income of 0.126 billion yuan, an increase of 35.45% year on year, and gross margin increased 3.24 percentage points year on year to 48.95% year on year. The above two businesses have followed the steady growth of the industry, and profitability has also benefited from a slight improvement in the scale effect.
valuations
Under the current share capital, in line with the slowdown in revenue growth in some sections of the company's semi-annual report, we adjusted the company's 2024-2026 earnings forecast to 1.53/2.02/2.58 yuan (the original 2024-2026 dilution forecast was 1.61/2.34/2.90 yuan), corresponding to a price-earnings ratio of 13.3/10.1/7.9 times; maintaining an increase in holdings rating.
The main risks faced by ratings
Energy storage policy development falls short of expectations; NEV industry policy falls short of expectations; price competition exceeds expectations; risk of international trade friction; risk of worsening industry competition pattern.