Incidents. The company released its three-quarter report, with 24Q3 revenue of 1.725 billion yuan, +8.4%/+7.33% YoY, net profit of 0.292 billion yuan to mother, +44.7%/+34.02% YoY. Net profit after deducting non-return to mother was $0.263 billion, +32.2%/+33.7% YoY.

The revenue side continued to grow steadily, and exchange rate fluctuations and cost control contributed to profits exceeding expectations. 24Q3 revenue was 1.725 billion yuan, +8.4%/+7.33% YoY, net profit to mother 0.292 billion yuan, +44.7%/+34.02% YoY. Net profit after deducting non-return to mother was $0.263 billion, +32.2%/+33.7% YoY. Revenue continued to grow steadily, contributing to profit exceeding expectations.

Equity incentives show confidence in steady growth, and overseas production capacity layout supports growth. The company released a new equity incentive plan based on the current industry and its own project order situation, demonstrating confidence in continued steady growth. The company has overseas production bases in North America, Southeast Asia, Europe, etc. Construction of the second phase of the Mexican plant (production base for structural parts and tri-electric system components for new energy vehicles) began in 2023, and production is scheduled to be put into operation in the second quarter of 2025. Currently, production and construction work is progressing steadily. The product range of the project covers products such as NEV body parts, NEV battery system units, NEV motor housings, NEV electronic control and other types of shells. By investing in medium and large die-casting lean units and lean processing units, we will increase the company's competitiveness in the North American market, enhance comprehensive and in-depth cooperation with global multinational auto parts manufacturers and OEMs on a global scale, increase customer stickiness, and achieve the company's strategic transformation and upgrading.

Profit forecast: We expect revenue for 24-26 to be 7.45/9.68/12.1 billion yuan, with year-on-year growth rates of 25%, 30%, and 25%, and net profit to mother of 0.97/1.21/1.47 billion yuan for 24-26, respectively. The year-on-year growth rates are 7%, 24%, and 22% in sequence, maintaining a “buy” rating.

Risk warning: industry demand falls short of expectations, customer expansion falls short of expectations, increased competition, sharp rise in raw materials, etc.