Core views

Yingjie Electric released its 2024 three-quarter report. 2024Q3 achieved revenue of 0.532 billion yuan in a single quarter, up 8.78% year on year, up 25.87% month on month, and achieved net profit of 0.125 billion yuan, up 7.00% year on year and 28.49% month on month, achieving net profit without return to mother of 0.122 billion yuan, up 4.59% year on year and 29.19% month on month. Confirm that the sales revenue situation is normal. The profit and loss of minority shareholders of the Q3 company was 5.16 million yuan, compared to 0.0166 million yuan in the same period last year. Most of the profit and loss of minority shareholders from Q1 to Q3 in 2024 came from the introduction of shares by the subsidiary Yingjie Chenhui. Currently, the company holds 75% of the shares in the subsidiary Yingjie Chenhui.

Yingjie Chenhui is a subsidiary of the company's RF business. It is of great significance to the company's future development. It continues to be optimistic about the company's RF power supply business development and domestic substitution competitiveness.

occurrences

Yingjie Electric released its 2024 three-quarter report. 2024Q1-Q3 achieved operating income of 1.329 billion yuan, a year-on-year increase of 17.36%, achieved net profit of 0.303 billion yuan, an increase of 8.27% over the previous year, and achieved net profit deducted from non-mother of 0.293 billion yuan, an increase of 6.59% over the previous year.

The 2024Q3 company achieved revenue of 0.532 billion yuan in a single quarter, up 8.78% year on year, up 25.87% month on month, and achieved net profit of 0.125 billion yuan, up 7.00% year on year, up 28.49% month on month, and realized net profit without deduction of 0.122 billion yuan, up 4.59% year on year and 29.19% month on month.

Brief review

Revenue situation: The 2024Q3 company achieved revenue of 0.532 billion yuan in a single quarter, an increase of 8.78% over the previous year, confirming the normal sales revenue situation.

Gross profit margin: Q3's gross margin was 41.68%, up 1.12 pct, down 0.79 pct; Q3's net profit margin was 24.55%, up 0.57 pct year on year, up 0.19 pct month on month, and the company's profitability remained stable; the company's gross margin was 42.01% in the first three quarters, up 2.59 pct year on year, which is expected to benefit mainly from the increase in semiconductor revenue share and higher semiconductor gross margin.

Period expenses: The company's expenditure rate for the first three quarters of 2024 was 14.76%, an increase of 1.63 pct over the previous year, mainly related to the increase in the company's R&D expenses rate. The company's R&D expenses rate in the first three quarters of 2024 was 7.59%, an increase of 2 pcts over the previous year. The company's R&D personnel and share payments increased in 2024.

Minority shareholders' profit and loss: Q3 company's minority shareholders' profit and loss was 5.16 million yuan, which is roughly equivalent to the second quarter; last year's Q3 period was 0.0166 million yuan. Most of the minority shareholders' profit and loss from Q1 to Q3 in 2004 came from the subsidiary Yingjie Chenhui introducing shares in China and Micro. Currently, the company holds 75% of the shares of the subsidiary Yingjie Chenhui. Yingjie Chenhui is a subsidiary of the company's RF business. It is of great significance to the company's future development. It continues to be optimistic about the company's RF power supply business development and domestic substitution competitiveness.

Balance sheet: As of the end of September 2024, the company's inventory was 1.759 billion yuan, down 5% month on month; contract debt was 1.104 billion yuan, down 11.5% month on month.

Cash flow: The company's cash flow improved markedly. The net cash flow from operating activities in the first three quarters of 2024 was 0.346 billion yuan, compared to -0.4 0.5 billion yuan in the same period last year, showing a clear net inflow this year.

Profit forecast and valuation: We expect the company's revenue for 2024-2026 to be 2.09, 2.71, and 3.49 billion yuan, respectively, and the estimated net profit to mother will be 0.49, 0.64, and 0.85 billion yuan, respectively, corresponding to PE 22.9, 17.3, and 13.1 times, respectively.

Risk analysis

1. Significant fluctuations in raw material prices: A sharp rise in the price of upstream raw materials will disrupt the company's performance; 2. Production expansion falls short of expectations: the company's orders are closely related to the downstream production expansion process. In terms of photovoltaic business, there is a large correlation with the scale and progress of silicon wafers and silicon wafers; in terms of semiconductors, it is more related to the expansion of production of silicon carbide, silicon semiconductors, MOCVD equipment, etc., and downstream production expansion will affect the company's order level;

3. The downstream replacement progress of new products falls short of expectations: the company's various products are on the eve of domestic substitution, and verification progress, replacement progress and penetration rate improvement will have an impact on the company's performance;

4. The impact of macroeconomic fluctuations on the company.