Weixing Co., Ltd.: One-stop supplier of clothing accessories, a leading enterprise in the garment accessories industry. According to the company's financial report, the company is mainly engaged in the research, production and sale of clothing accessories such as zippers and buttons. In 2023, the company produced 11.6 billion buttons and 0.85 billion meters of zippers per year, making it a leading enterprise in the domestic garment accessories industry.

The global accessories market is broad, and the company still has room to increase its share. According to estimates from the company's financial reports, prospectus, etc., the company's share of the global high-end zipper market is about 6%, and the market share of high-end buttons may be less than 10%. Judging from industry trends, China's textile and garment industry is gradually shifting to Southeast Asia. We believe that the company's expansion of Vietnam's industrial parks is of strategic significance, which will help enhance upstream and downstream collaboration in overseas production capacity, and strengthen cooperation among brand manufacturers.

Based on corporate culture, the company's comprehensive competitiveness continues to increase, accelerate the expansion of overseas production capacity, and is expected to gain a higher market share. According to the company's financial report and prospectus, on the one hand, the company is implementing an internationalization strategy in terms of brand cultivation, marketing network, and production base, and the Vietnam Industrial Park is expected to have a production capacity of 0.124 billion zipper bars and 0.398 billion metal buckles after production; on the other hand, the company will improve product quality and quality stability through intelligent manufacturing and informatization transformation, and focus on R&D investment and development, gradually narrowing the gap with YKK in the zipper field, and is expected to continue to increase its share in the middle and high-end zipper market. On the R&D side, the company continues to invest high in R&D, and its R&D strength continues to grow. By the end of 2023, the company had 706 R&D personnel, invested 0.16 billion yuan in R&D, obtained 1,270 domestic and foreign patents, and established a design center in Shanghai. It has become one of the garment accessories companies with the strongest accumulation of technical and design strength in China. On the intelligent manufacturing side, the company promotes intelligent and automated construction, driving continuous improvement in per capita revenue (CAGR 9.9% in 2019-2023) and quick reaction capabilities, and maintaining a leading position in the industry for a long time.

Profit forecasting and investment advice. The company's EPS is expected to be 0.59/0.67/0.78 yuan/share in 24-26, respectively. Referring to comparable companies and company historical valuations, the 24-year PE valuation is 22 times, corresponding to a reasonable value of 12.93 yuan/share, and a “buy” rating.

Risk warning. The risk of a decline in macroeconomics and prosperity, the risk that factor costs will continue to rise, and the risk of increasing uncertainty in the international trade environment.