Key points of investment

The performance was in line with expectations, and exchange rate fluctuations had an impact

In 24Q3, the company achieved revenue of 1.443 billion yuan, a year-on-year increase of 22.27%; net profit to mother of 0.704 billion yuan, an increase of 20.47%; net profit after deduction of 0.665 billion yuan, a year-on-year increase of 24.20%, which is in the middle of the performance forecast. The profit growth rate is slightly lower than the revenue growth rate. We judge that it is mainly affected by exchange rate fluctuations.

In the first three quarters of 24, the company achieved revenue of 4.11 billion yuan, a year-on-year increase of 27.49%; net profit to mother of 2.065 billion yuan, an increase of 27.91%; net profit after deduction of 1.917 billion yuan, an increase of 33.26% year-on-year.

Release new VCS/headset products to enrich product matrix

In the third quarter, the company launched the MeetingEye 900 split video conference terminal, UVC85 camera, professional video conferencing omnidirectional microphone CP50 & CPE40, and the UVC40 E2 ultra-clear smart USB conference all-in-one computer.

At the same time, the business headset product line has been continuously enriched, and the BG74 advanced Bluetooth wireless headset has been launched to provide a high-definition professional voice communication and collaboration experience.

The growth of cloud office terminals is expected to accelerate. Looking at the three product lines that are optimistic about optimizing the product structure, the desktop communication terminal market is relatively mature. The company has the highest market share of SIP phones in the world, and 24H1 benefits from the demand for inventory replenishment. As the second and third growth curves, conference products and cloud office terminals contributed to a faster growth rate. 24H1 grew by 51% and 29% respectively. Looking ahead to 2025, we are optimistic about optimizing the company's product structure. Conference products benefit from the hybrid office trend and are expected to continue to grow rapidly; cloud office terminals will complete product optimization and adjustment in 23, release new products and improve the product matrix in 24, and growth is expected to accelerate further.

We expect the growth rates of the company's desktop communication terminals, conference products and cloud office terminals to be 3%, 30%, and 40% respectively in 2025, accounting for 47%, 42%, and 11% of revenue respectively. The second and third growth curves contributed to high growth, and the company's product structure is expected to be optimized to further boost valuation.

Focusing on shareholder returns, the dividend rate for the full year is expected to reach 4.3%. The company will issue a mid-term profit distribution plan. It plans to distribute cash dividends of 6.0 yuan (tax included) to all shareholders for every 10 shares, totaling 0.757 billion yuan in cash dividends, accounting for about 56% of 24H1's net profit to mother. If the dividend ratio for fiscal year 23 remains unchanged at 57%, and the annual dividend for '24 may reach 1.14 yuan/share, the dividend rate for the full year of 24 may reach 4.3%.

Profit forecasting

The company's net profit for 24-26 is estimated to be 2.56, 2.99, and 3.44 billion yuan, respectively, +27.5%, 16.7%, and 15.0% year-on-year, respectively, corresponding to the 24-26 PE of 20, 17, and 15 times, respectively, maintaining a “buy” rating.

Risk warning

Exchange rate fluctuations exceeded expectations, prices of upstream raw materials fluctuated; industry competition increased risks, etc.