Incident: The company released the “2024 Semi-Annual Report” on the evening of August 6. The company achieved operating income of 2.738 billion yuan, an increase of 21.28% year on year; net profit attributable to shareholders of listed companies was 0.162 billion yuan, an increase of 109.79% year on year; and net profit attributable to shareholders of listed companies after deducting non-recurring profit and loss was 0.149 billion yuan, an increase of 135.27% year on year.
The domestic market is growing steadily, and the overseas market is expanding rapidly. 2024H1, the company's domestic and overseas channel business continued to expand. The domestic market achieved revenue of 1.398 billion yuan, an increase of 14.87% year on year; the overseas market achieved revenue of 1.34 billion yuan, an increase of 28.77% year on year, and its share of revenue increased from 46.10% during the same period to 48.95%, effectively helping the company achieve rapid growth in revenue. 2024H1 is aimed at overseas markets. The company focuses on strengthening related market development, and promotes project delivery and implementation around major projects and key regions, and reserves a rich pool of project resources.
Intelligent manufacturing drives high-quality development, and the EMS business unleashes strong growth momentum. The company fully revolves around the concept of “building fast and high-quality delivery capabilities”, continuously optimizes supply strategies to cope with the severe and changing macro situation, ensures stable supply of orders, and continues to guarantee supply efficiency through multi-dimensional cost control and fee reduction. The company's EMS business is based on high-end manufacturing capabilities, and promotes business integration and explores high-value customers and orders around three key areas, including new energy and automotive electronics, intelligent robots, communications and servers. In the field of new energy vehicle electronics, the company's customers have covered most of the world's leading power battery manufacturers as well as popular models from leading domestic NEV manufacturers such as Tesla, Extreme, Wanjie, Xiaopeng, Ideal, Volkswagen, and BMW.
Promote marketing reforms and strengthen refined management. 2024H1. In order to fully implement the goal of “reshaping the core competitiveness of enterprises”, the company further promoted marketing system transformation, fully implemented digital marketing, upgraded the official website, marketing automation platform, and customer relationship management platform, strengthened channel construction and coverage, and further broadened business boundaries by developing more partners and dealers in non-traditional private network industries. The company adheres to the concept of refined management and strictly controls all expenses. The cost rate for the period decreased by 4.11 percentage points year on year.
Investment advice: The company is the world's leading provider of dedicated communications and solutions. It is committed to providing customers in public safety, emergency, energy, transportation, industry and commerce industries with faster, safer and more connected communication equipment and solutions, digging deeper into industry pain points, deepening customer needs, and continuously improving R&D capabilities and operational efficiency. We expect the company's net profit to be 0.409/0.568/0.756 billion yuan in 2024-2026, respectively. The corresponding growth rates are negative losses/ 39%/33%, and the corresponding PE is 17.6X/12.7X/9.5X, respectively, maintaining the “increase” investment rating.
Risk warning: Overseas litigation risk, geopolitical risk, exchange rate fluctuation risk, cost fluctuation risk, increased competition risk, intellectual property risk, shareholder pledge risk.