Core views:

The company achieved total revenue of 143.732 billion yuan in the first three quarters of 2024, up 13.61% year on year; net profit to mother of 3.31 billion yuan, up 223.80% year on year; net profit after deducting 2.308 billion yuan, up 254.67% year on year. 2024Q3 achieved revenue of 50.345 billion yuan in a single quarter, up 8.65% year on year; net profit to mother was 1.026 billion yuan, up 258.21% year on year; net profit after deduction was 0.694 billion yuan, up 651.97% year on year.

LCD product structure has been optimized, and OLED shipments continue to increase. In the LCD field, in the first half of 2024, the company's five mainstream application shipments steadily ranked first in the world. The share of core clients continued to increase, superior high-end flagship products made steady breakthroughs, and oversized (≥85”) products remained number one in global shipments. Product structure optimization, stable breakthrough in superior high-end flagship products. In the flexible OLED field, product shipments have increased, and many flexible AMOLED high-end folding products have been sold exclusively to customers, creating the first products of many brands. In addition, the company lays out four high-potential waterways of IoT innovation, sensing, MLED, and smart medical engineering to promote the implementation of the IoT transformation strategy.

The subsidiary BOE Energy applied for listing on the New Third Board to accelerate the development of innovative businesses. On October 30, 2024, BOE issued an announcement agreeing to BOE Energy, a holding subsidiary of the company, to apply for listing on the New Third Board. BOE Energy provides customers with zero-carbon integrated energy services, which mainly include the three major sectors of integrated energy supply, integrated energy services and zero-carbon services. According to the company's strategic plan, the company plans to accelerate the development of innovative businesses through incubation and listing of innovative businesses, enhance the company's market competitiveness in the energy Internet of Things sector, and maximize the optimal allocation and value of assets. At the same time, through the listing of subsidiaries, the company's visibility is increased, and the attention of more investors is attracted, thereby enhancing the company's market position and brand value, which is in line with the company's strategic goals.

Profit forecasting and investment advice. We expect the company's EPS to be 0.12/0.24/0.32 yuan/share in 24-26, respectively. Due to the heavy assets and cyclical nature of the industry, PB valuation is used. The company is expected to reach 3.51 yuan/share in 24 years. Referring to comparable company valuations, the company is given a 24-year PB valuation of 1.5 times, a reasonable value of 5.27 yuan/share, giving it a “buy” rating.

Risk warning. Fluctuations in industry sentiment, international trade risks, world economic recovery risks, etc.