occurrences

The company released a performance forecast for the first three quarters of 2024. It is expected to achieve operating income of 2.66-2.94 billion yuan in the first three quarters of 2024, up 21.48% to 34.27% year on year; net profit to mother of 0.52-0.57 billion yuan, up 95.10% to 113.86% year on year; net profit without deducted from mother 0.42-0.47 billion yuan, up 56.85% to 75.53% year on year.

reviews

The boom accelerated the release of profits. The median net profit forecast for the first three quarters exceeded Wind's median forecast for the full year. The company achieved operating income of 2.8 billion yuan, an increase of 27.88% year on year; net profit to mother of 0.545 billion yuan, an increase of 104.48% year on year; net profit without deduction of 0.445 billion yuan, up 66.19% year on year.

As of October 9, Wind's consistent forecast for the company's net profit for the full year was 0.536 billion yuan. The median net profit forecast for the first three quarters of the company has already exceeded the consistent forecast for the full year's profit.

According to the company's announcement, the company has grasped the development opportunities of the overseas new energy charging industry, deeply cultivated the digital energy overseas market, achieved rapid growth in performance and built medium- to long-term competitive barriers with systemic advantages such as products, technology, brands, markets, services and global supply chains.

The trend of automobile intelligence+electrification, the trend of collaborative development of the main two-wheel drive business and the new energy business: the traditional diagnostic business has stable demand in the overseas automotive aftermarket, high gross margin, and can contribute continuous cash flow to the company. Along with the trend of automobile intelligence and the increase in the penetration rate of intelligent driving, demand for the company's ADAS series products is expected to increase, supporting the accelerated growth of traditional diagnostic services.

Electrification trend: The potential demand for overseas charging piles is huge. As the second growth curve, the company's new energy charging pile business is expected to continue to grow, driving revenue growth.

Profit forecasting and valuation

Considering that the company's 2024 three-quarter report forecast exceeded expectations, we raised our previous profit forecast. We expect the company's revenue for 2024-2026 to be 40.55, 51.55, and 6.481 billion yuan, respectively, up 24.71%, 27.15%, and 25.72% year-on-year, respectively; net profit to mother is 0.6, 0.746, and 0.953 billion yuan. Upgraded from “Overstock” to “Buy” rating.

Risk warning

The implementation of new energy charging piles and ADAS products fell short of expectations; market competition intensified; changes in the policy environment; tariffs increased dramatically