In 2024Q0.03 million, Fengaowei achieved revenue of 4 billion yuan, +4% month-on-month. The company achieved revenue of 11.37 billion yuan in the first three quarters of 2024, -1.97% YoY, and net profit to mother of 0.564 billion yuan, +5.07% YoY.

On a quarterly basis, the company achieved revenue of 3.999 billion yuan in 2024Q3, -2.28% YoY, +4.36% month-on-month, and net profit to mother 0.165 billion yuan, -24.02% YoY, and -3.44%. Overall, revenue from January to September 2024 fell 1.97% year on year, mainly due to the fact that the same period last year included the Wuxi Xiongwei high-strength steel stamping parts business. If this business was excluded for the same caliber comparison, total operating income increased 4.23% year on year; realized net profit to mother was 0.564 billion yuan, an increase of 5.07% over the same period last year.

2024Q3 gross margin decreased by 1.6 pct month-on-month, and four rates decreased year-on-year. 2024Q3's gross profit margin was 15.7%, -2.6 pct year on year, -1.6 pct month on month, 5.4% net profit margin, -1.pct year on year, -0.7 pct month on month. 2024Q3's four-rate rate was 9.83%, -0.33pct year over year and +0.04pct month-on-month.

Based on the lightweighting of automobiles, general aviation aircraft open up room for economic growth at low altitude. Wanfeng Aowei's business includes two major parts: lightweight automobiles and general aviation aircraft manufacturing. The automobile lightweight business includes automobile and motorcycle aluminum alloy wheel manufacturing business, magnesium alloy auto parts manufacturing business, and general aviation aircraft manufacturing business includes the entire R&D, production, sales, and after-sales service process of general aviation aircraft. By business, 1) From January to September 2024, the company's automotive metal parts lightweight business revenue was 9.383 billion yuan, down 3.76% year on year. The company's automotive metal parts lightweight business orders were sufficient, and overall sales increased year on year, but due to the influence of Wuxi Xiongwei's presentation, revenue decreased year on year; 2) From 20241 to September, the company's general aviation aircraft innovation manufacturing business revenue was 1.987 billion yuan, up 7.49% year on year. The company's general aviation aircraft manufacturing business has sufficient orders, continuous optimization of sales business, global private jet market development and gradual release of production capacity. Overall sales of diamond aircraft are stable, while delivery of new high-value-added aircraft and after-sales service business are steadily improving. In the future, with the development of the low-altitude economy, Diamond Aircraft will continue to explore new application scenarios based on application markets such as aviation school training, and further match and develop domestic private flight, short-haul transportation, and special use scenarios through a rich model series, increase research and development of new aircraft such as electric aircraft and eVTOL, seize new opportunities for the country's low-altitude economic development, and work with strategic partners to accelerate the low-altitude economy market layout.

Risk warning: Low-altitude economic development falls short of expectations; raw material prices fluctuate.

Investment advice: Maintain profit forecasts and maintain ratings that are superior to the market. The company's lightweight automobiles and two-wheel drive general aviation aircraft. The next highlights are the increasing demand for lightweight new energy vehicles and the development of the general aviation low-altitude economy industry. We maintain our profit forecast. We expect revenue of 17.1/18.6/20.5 billion yuan and net profit of 0.946/1.105/1.302 billion yuan for 24/25/26, corresponding to PE 53/46/39x, respectively, and maintain a “superior to market” rating.