Description of the event

The company released its 2024 semi-annual performance report. 2024H1 achieved revenue of 0.276 billion yuan, an increase of 37.75%; realized net profit attributable to mother of 0.074 billion yuan, an increase of 65.11%; and realized net profit without deduction of 0.074 billion yuan, an increase of 65.71%.

Incident reviews

All businesses have achieved rapid growth. By business, the 2024H1 structural mechanical performance testing and analysis system achieved revenue of 0.19 billion yuan, an increase of 36.24%; the PHM system for structural safety online monitoring and defense equipment achieved revenue of 0.04 billion yuan, an increase of 15.78%; the PHM-based intelligent equipment maintenance management platform achieved revenue of 0.014 billion yuan, an increase of 33.56%; the electrochemical workstation achieved revenue of 0.026 billion yuan, an increase of 135.51%; development services and others achieved revenue 0.006 billion yuan, up 25.83% from the same period.

The net interest rate increased significantly year-on-year, and the expense ratio declined. 2024H1, the company's gross margin decreased by 0.03 pct to 66.00%, and remained stable; net margin also increased 4.38 pct to 26.85%, and profitability increased significantly over the same period last year. In terms of cost ratio, the 2024H1 company's cost ratio decreased by 3.67 pct to 34.23%. Among them, the sales expense ratio decreased by 1.09 pct to 12.40%, the management expense ratio decreased by 2.09 pct to 11.35%, the financial cost ratio also increased by 0.10 pct to 0.00%, and the R&D cost rate also decreased by 0.58 pct to 10.48%.

The traditional structural mechanics business is expected to continue to benefit from the trend of domestic substitution. As the country vigorously promotes national defense construction, the structural mechanical performance testing instrument industry has received much attention and has developed rapidly. Currently, leading international companies in related fields include NI, SIMENS, HBK, etc., but international manufacturers lack timeliness and flexibility in product sales and after-sales service, and are relatively weak in adapting to the Chinese market. At the same time, due to the special nature of the downstream industry, many companies require the localization of all products. Through continuous R&D and technological accumulation, the company has mastered the relevant core technology in the field of structural mechanical performance testing. Its product strength and service capabilities are outstanding, and it is expected that it will continue to benefit from the major trend of domestic substitution.

Open up many new fields and open up room for long-term growth. In terms of sensors, the company is actively developing new products. On the one hand, it focuses on sensors used in the original main business to improve adaptability and accuracy; on the other hand, it is actively expanding application fields. The six-dimensional torque sensors are already in small-batch production. In addition, the company is promoting the development and implementation of two new products, a customized measurement and control analysis system and an experimental and simulation integrated analysis platform, which is expected to further enrich the company's product line and open up room for long-term growth.

Profit forecasting and valuation

The company's 2024-2026 revenue is expected to be 0.579, 0.755, and 0.958 billion yuan, with year-on-year growth rates of 53.08%, 30.37%, and 26.96%; net profit to mother is 0.17, 0.224, and 0.286 billion yuan, with year-on-year growth rates of 93.29%, 32.31%, and 27.63%. The company's 2024-2026 performance corresponding to PE was 23.03, 17.41, and 13.64 times, respectively, maintaining the “gain” rating.

Risk warning:

Risk of developing new fields less than expected; risk of delayed delivery; increased risk of competition.