Incidents:
On April 26, the company released its 2024 quarterly report: in the first quarter of 2024, the company achieved operating income of 5.688 billion yuan, up 27.29% year on year; net profit to mother was 645 million yuan, up 43.36% year on year; net profit after deducting non-return to mother was 596 million yuan, up 41.79% year on year.
The Tier 0.5 model helped improve performance. The Tier 0.5 model implemented by the company and strategic customers achieved exemplary success in the first quarter. The model had many bicycle supporting products and a high supporting amount. The company also promoted the model to other domestic customers, such as Cyrus, Ideal, Chery, Great Wall, Xiaomi, BYD, Geely and other vehicle companies. Increased bicycle supporting value led to continued improvement in performance. The company achieved operating income of 5.688 billion yuan in the first quarter of 2024, an increase of 27.29% year-on-year, and 2.51% month-on-month profit; achieved net return to mother It was 645 million yuan, up 43.36% year on year, and 16.59% month on month.
Cost control continues to advance, and the net interest rate due to mother has increased significantly
The company controlled costs through measures such as large-scale procurement, technological innovation, and strict implementation of budget management. The company's gross margin for the first quarter was 22.43%, +0.58/-1.67pct, respectively. In terms of expenses, the sales/management/R&D/finance expense ratios for the first quarter of 2024 were 1.38%/2.75%/4.49%/0.71%, respectively, +0.22/+0.07/-0.27/-0.80pct, respectively. The total cost rate for the period was 9.33%, and -0.78/-0.04pct, respectively. The company's equity interest rate for the first quarter of 2024 was 11.39%, +1.23/+1.54pct, respectively. Affected by this, profit month-on-month monetization was superior to revenue.
The automotive and robotics industries are developing, and new products have entered the harvest period of mass production. The company set up an electric drive division in 2023 to enter the robot industry chain. The robot electric drive actuators and rotary actuators developed have been sent samples to customers many times and have been recognized and praised by customers, and the project is progressing rapidly. At the same time, the company's two electric drive system production lines were officially put into operation on January 8, 2024, with an annual production capacity of 300,000 sets of electric drive actuators, and planning and design for additional production capacity has already begun. The automotive+robot dual industry model is expected to lay a solid foundation for the company's long-term development.
Profit Forecasts, Valuations, and Ratings
We expect the company's revenue for 2024-2026 to be 266.83/344.29/44.815 billion yuan, respectively, with corresponding growth rates of 35.44%/29.03%/30.17%; net profit to mother of 28.39/38.44/5.106 billion yuan, respectively, corresponding growth rates of 31.99%/35.41%/32.85%, EPS 2.44/3.31/4.39 yuan/share, and CAGR-3 33.41%, respectively. In view of the continuous advancement of the company's product platformization strategy and Tier 0.5 model, customers continue to develop, and orders are expected to continue to maintain a rapid growth trend. At the same time, the new robot business continues to advance, creating a new growth pole for the company. It is recommended to continue to pay attention.
Risk warning: Downstream demand falls short of expectations, risk of exchange rate fluctuations, risk of raw material price increases