国产薄膜电容龙头企业，受益光储复苏盈利能力改善。公司深耕薄膜电容五十余年，产品覆盖全系列薄膜电容器，下游客户涵盖新能源汽车、光伏、风电、工业控制、轨道交通等行业。薄膜电容是新能源车电动化及光伏逆变器的核心元器件，法拉电子顺应新能源发展趋势，将业务重心逐渐转移至新能源板块，产品结构持续优化。Incidents:
In the first half of 2024, the company achieved operating income of 2.117 billion yuan, a year-on-year increase of 7.38%; net profit to mother was 0.482 billion yuan, a year-on-year decrease of 1.86%; net profit after deducting non-return to mother was 0.46 billion yuan, a year-on-year decrease of 9.51%. Among them, the second quarter achieved operating income of 1.137 billion yuan, up 9.07% year on year and 15.99% month on month; net profit to mother was 0.266 billion yuan, up 2.49% year on year and 23.58% month on month.
Comment:
Leading domestic thin-film capacitor companies are benefiting from the recovery of optical storage and improved profitability. The company has been deeply involved in film capacitors for more than 50 years. Its products cover a full range of film capacitors, and downstream customers cover industries such as new energy vehicles, photovoltaics, wind power, industrial control, rail transit, etc. Film capacitors are the core components for electrification of new energy vehicles and photovoltaic inverters. Farah Electronics is gradually shifting its business focus to the new energy sector in line with the new energy development trend, and the product structure continues to be optimized.
Benefiting from the recovery in domestic demand for optical storage and the continued increase in profitability of new energy vehicles, the gross profit margin for the second quarter of 2024 was 34.92%, up 1.80 pcts month-on-month; the net interest rate was 23.46%, up 1.44pcts month-on-month.
Strengthen the international layout and embrace the growth of leading global customers. Leading international film capacitor manufacturers such as Japan's Panasonic, TDK, and the US's KIMEI have all achieved multiple business layouts. They not only manufacture thin film capacitors, but are also diversified manufacturers of other electronic components, semiconductors, chemical materials, etc. With the rise of downstream domestic brands, the film capacitor supply chain is concentrated on domestic core manufacturers, and Chinese manufacturers, represented by Farah Electronics, continue to catch up with technology, and it is expected that the supply chain will be localised. Film capacitors have high technical and process barriers. As a leading domestic film capacitor, Farah Electronics is expanding production at an accelerated pace, and continues to strengthen its global layout, focusing on the global market, and actively expanding high-end customers in the fields of new energy vehicles and photovoltaics overseas.
The company issued an announcement on overseas investment projects. It plans to invest and establish a wholly-owned subsidiary Farah Electronics Hungary Co., Ltd. in Hungary with its own capital of not more than 0.1 billion yuan to strengthen the internationalization strategy and promote exchanges and cooperation with overseas markets.
Profit forecast and investment rating: We expect the company to achieve net profit of 1.17/1.389/1.617 billion yuan in 2024/2025/2026, respectively. The corresponding PE is 15/13/11 times, respectively, covered for the first time, and given a “buy” rating.
Risk warning: raw material price fluctuation risk, international trade risk, exchange rate fluctuation risk
