Key points:

The performance of the 2024 three-quarter report remains excellent. It continues to be optimistic that the company will deliver the 2024 three-quarter report. The third quarter achieved operating income of 0.134 billion yuan, an increase of 40.37% year on year; achieved net profit attributable to shareholders of listed companies of 81.6327 million yuan, an increase of 45.53% year on year; and realized net profit of 76.5994 million yuan after deducting non-recurring gains and losses belonging to shareholders of listed companies, an increase of 55.73% year on year.

The performance is still excellent, and I am optimistic about the increase in the company's product market penetration rate and the high performance growth brought about by downstream volume.

Accounts receivable have increased, and operating gross margin has increased

As of the end of the third quarter, the company's accounts receivable were 0.3 billion yuan, up 33.78% from 0.224 billion yuan in the same period in 2023; the company's gross operating margin as of the end of the third quarter of 2024 was 83.97%, up 0.96pct from 83.01% of the 2023 annual report. The report data shows that the company has a stable position in the industry, has high bargaining power, maintains a relatively high gross margin level of the company's products, and continues to be optimistic about the company's leading position in the field of high-performance inertial sensor chips.

The downstream involves a number of new quality productivity industries, and the volume is imminent

The company's high-performance inertial sensor chips can be widely used in high-reliability, high-end industrial and unmanned systems, including commercial aerospace, commercial navigation, resource exploration, surveying and mapping, industrial IoT, drones, intelligent driving, unmanned ships, robots, etc. The company has successively obtained targeted projects from customers and large orders from customers. Since its listing, the company's performance has continued to be excellent, proving that the company's high-performance inertial sensor chips have excellent quality as basic devices. We are optimistic that the company's future performance will continue to increase.

Investment advice

We are optimistic about the long-term development of the company. The high reliability+civilian market is expected to support the company's high revenue growth in the next few years. The profit forecast is: 2024-2026 is 0.472/0.684/0.968 billion yuan; the net profit forecast for 2024-2026 is 0.238/0.329/0.405 billion yuan, respectively; and the EPS corresponding to 2024-2026 is 0.60/0.82/1.01 yuan. The PE corresponding to the company's current stock price is 78/56/46 times, maintaining a “buy” investment rating.

Risk warning

1) Breakthroughs in technology research and development fall short of expectations; 2) downstream demand falls short of expectations; 3) loss of core technical personnel; 4) large fluctuations in raw material costs affect gross profit margin; 5) Market competition increases the risk of affecting gross margin.