营收受汽车拉动而受通信拖累。公司2Q24 实现营收8.83 亿元、同环比+12%/+15%，对应汽车B 客户批发104 万辆、同环比+43%/+53%，T 中国20.6万辆、同环比-17%/-7%，T 全球48 万辆、同环比-13%/持平；根据工信部，1Q、2Q 国内新增5G 基站均为27 万个。Matters:
The company released its 2024 mid-year report. Revenue for the first half of the year was 1.65 billion yuan, +3% year-on-year, net profit to mother -0.018 billion yuan, and 1H23 was profit of 0.121 billion yuan.
Commentary:
Revenue was driven by cars and dragged down by communications. In 2Q24, the company achieved revenue of 0.883 billion yuan, +12%/+15%, corresponding to Auto B customers wholesale 1.04 million vehicles, +43% YoY/+53%, T China 0.206 million vehicles, -17%/-7% YoY, T Global 0.48 million vehicles, -13% YoY/flat; according to the Ministry of Industry and Information Technology, the number of 5G base stations added in 1Q and 2Q was 0.27 million.
Among them, 1H24 communications business revenue was 0.56 billion yuan, -34% year over year, gross profit margin of 10.5%, year-on-year -9.7PP; automobile business revenue was 1.02 billion yuan, +37% year over year, gross profit margin of 10.2%, and -4.2PP year over year.
Performance is still under pressure, and structure, depreciation, raw materials, and impairment are all affected. The company's net profit for 2Q24 was loss 0.025 billion yuan, 2Q23 profit 0.065 billion yuan, 1Q24 profit 0.006 billion yuan, 2Q24 net interest rate -2.8%, year-on-year -11.0PP, and -3.6PP month-on-month. Specifically:
1) Gross profit margin: 9.6%, year-on-year -8.7PP, month-on-month -3.8PP, 2Q Shanghai aluminum average price +11%/+8% year-on-month had a certain impact on gross margin. The 1H24 discount ratio was 12.0% and +3.0PP year-on-year under the new production capacity. In addition, downstream annual downward pressure was also reflected;
2) Expense rate: three rate 11.8%, YoY +2.0PP/+0.5PP, of which management rate is 5.7%, YoY +0.7PP/+0.7PP, financial rate 0.5%, YoY +1.6PP/-0.3PP, R&D rate 4.8%, and -0.4PP/+0.2PP YoY.
3) Impairment: Asset impairment loss of 0.015 billion yuan, basically consistent from month to month, mainly in preparation for inventory price decline.
The competitive advantage of the electric lightweight dividend plus the company's integrated die-casting is expected to drive the rapid growth of the company's automotive business.
Compared to fuel vehicles, the increase in aluminum castings unique to fuel vehicles is about 30-50 kg/vehicle, corresponding to about 1500-2,500 yuan/vehicle. At the same time, weight reduction and cost drive the development of integrated die-casting. The company itself: ① Actively seizes the growth opportunities of leading customers and grows with leading domestic and foreign NEV companies, and plans to expand production in Europe and the US are already in progress; ② it has accumulated R&D and production experience for medium and large parts earlier, which will help improve the yield of medium-sized automotive die-castings and form a cost-effective advantage more quickly; ③ the integrated die-cast 8800T rear floor and battery pack have taken the lead, and developed the world's first 13,000T double pressure chamber oversized body mold for Chery. The first-mover advantage will support the ability to take orders for subsequent new projects.
Global 5G base station structural components continue to grow, and technical advantage+leading customers protect the company's steady growth. Domestic 5G penetration is high, and base station construction is slowing down. According to the Ericsson Mobile Market Report, 5G penetration rates in North America, Northeast Asia, the GCC region, and Western Europe in 2023 were 61%, 41%, 34%, and 25%, respectively. Most other regions are 10% or even less than 5%. With overseas incremental support, the global 5G base station market is still expected to grow by 5-10% in the future. The company's 5G base station structural component cooling technology has a first-mover advantage, and is also expected to protect the company's long-term steady growth by binding the world's top two 5G base station equipment leaders.
Investment advice: The company's automobile business grows with the increase in downstream projects. The communications business is waiting for the industry to recover, the profit side continues to be pressured, or it may need to wait further for the release of orders for new projects. According to the 2024 mid-year report, we adjusted the company's 2024-2025 net profit forecast from 0.23 billion yuan and 0.27 billion yuan to 0.046 billion yuan and 0.129 billion yuan, and introduced the 2026 net profit forecast of 0.186 billion yuan, -66%, +177%, and +45% compared to the same period last year. According to historical estimates, we gave the company 1.41 times the target PB for 2024, and the corresponding target price was adjusted to 22.2 yuan. The rating was revised down from “recommended” to “recommended.”
Risk warning: Macroeconomics and domestic consumption fell short of expectations, raw material price increases exceeded expectations, overseas telecommunications demand growth fell short of expectations, and the volume of integrated die-casting business fell short of expectations.
