Event: On August 29, the company released its 2024 semi-annual report.
First half of 2024: Revenue 1.576 billion yuan, +37.27% year over year; net profit to mother 0.179 billion yuan, +99.31% year over year; net profit without return to mother 0.158 billion yuan, +223.43% year over year; gross profit margin 52.33%, up 0.82 pcts year over year. The profit growth rate was higher than the revenue growth rate. It was mainly due to the year-on-year increase in gross margin and the increase in revenue. The scale effect was evident, and the R&D expense ratio declined year-on-year.
2024Q2:1) Revenue 0.85 billion yuan, +33.42% YoY, +16.23% month-on-month; 2) Net profit to mother 0.124 billion yuan, +109.10% YoY, +128.50% month-on-month; 3) Net profit without return to mother 0.108 billion yuan, +152.25% YoY, +113.43% month-on-month; 4) Gross profit margin 52.19%, +1.61 pcts YoY, -0.3 pcts month-on-month. The year-on-year profit growth rate was higher than the revenue growth rate, mainly due to the year-on-year increase in gross margin and the year-on-year decline in the R&D/management/sales expense ratio due to scale effects; the month-on-month growth rate higher than the revenue growth rate was mainly due to the scale effect, which led to a month-on-month decline in the R&D/management/sales expense ratio.
The advantages of a platform-based layout continue to be highlighted, driving continued high revenue growth. Following the recovery in consumer electronics demand in 2023Q2, demand for 2024Q2 industrial control, new energy, etc. has picked up, but the global macroeconomic recovery is still relatively slow. The company continues to deepen the product line layout, iterate on existing product lines and continuously launch new products. The product line covers the two major fields of signal chain and power management. Currently, there are 32 categories, with a total of more than 5,200 products available for sale, forming a certain competitive advantage in terms of the scale effect of SKU. At the same time, the company closely follows market demand and responds quickly, customer recognition and brand influence continue to increase, and the market share continues to expand. Drive higher revenue growth in the first half of the year.
Gross margin remained high, and the scale effect drove a significant improvement in profitability. The company's 2024Q2 gross margin was 52.19%, which stabilized at a high level of month-on-month. As revenue continued to grow and scale effects showed, the main expense ratio showed a year-on-month downward trend in the second quarter. Among them, the 2024Q2 R&D cost ratio was 24.7%, -2.9 pcts year on year, -3.8 pcts month on month, sales expenses rate 7.1%, -0.4 pcts year on year, -0.7 pcts month on month, management expense ratio 2.9%, year-on-year -0.5 pcts, and -0.7 pcts month-on-month, thus driving significant improvement in profitability. 2024Q2's net profit margin to mother was 14.3%, +5.2 pcts year over year and +7.3 pcts month over month.
The competitive situation at home and abroad has changed positively, and we are optimistic about the long-term allocation opportunities of the company as an industry leader. At the international level, Texas Instruments, the world's leading analog IC company, has lowered capital expenses in recent exchanges, which is expected to ease concerns about future oversupply. At the domestic level, many changes in the industry are beneficial to industry leaders: first, after the wave of shortages is mitigated, downstream customers gradually optimize the supply chain and concentrate their market share on leading companies due to considerations such as cost reduction and efficiency or product quality optimization; secondly, startups face greater financial pressure, compounding the influence of the “National Nine Rules” and the “Eight Science and Technology Innovation Boards”. Clear startups help improve the business environment of leading listed companies; in addition, in the localization process, leading companies have obvious cost advantages and stronger competition. power.
Investment advice: Supported by the platform-based layout and SKU size advantage, the company's 24Q2 revenue achieved high growth in an environment of weak recovery, gross margin continued to stabilize at a high level, and the scale effect drove a significant improvement in profitability. In the future, as new product sales and market share continue to increase, the company has high growth flexibility. The company's net profit for 2024-2026 is expected to be 0.372/0.695/1.057 billion yuan (previously predicted to be 0.335/0.685/1.075 billion yuan in 2024-2026), and the 2024/9/9 closing price corresponds to PE 89/47/31 times, maintaining a “buy” rating.
Risk warning events: downstream sentiment recovery falls short of expectations; risk of macro-environmental fluctuations