Incident: The company released its 23 annual report and 2014 quarterly report. In 23, it achieved revenue of 356 million yuan, -20.1% year-on-year; realized net profit of 84 million yuan, or -45.81% year-on-year. Looking at a single quarter, 23Q4 achieved revenue of 102 million yuan, +0.86% year-on-month, and +23.91% month-on-month; realized net profit of 12 million yuan, or -57.31% year-on-year, or -46.68% month-on-month. 24Q1 achieved revenue of 82 million yuan, -7.45% year-on-year, and -19.8% month-on-month; realized net profit of 0.2 billion yuan, -18.39% year-on-year and +72.58% month-on-month.
Against the backdrop of sluggish downstream demand, the company's revenue is under pressure. Global macroeconomic recovery was weak in '23, and demand in domestic industries such as 3C and semiconductor was sluggish, putting pressure on demand in the company's downstream industrial robotics and other industries. In '23, the company achieved revenue of 356 million yuan, -20.1% year over year. Among them, mechatronic products performed brilliantly, with revenue of +30.78% year over year to 34 million yuan in '23.
The increase in cost rates is mainly due to overseas layout+main business R&D promotion, which lays the foundation for future development. The company's 23-year sales/management/R&D/finance expense rates were 3.06%/6.18%/13.59%/-6.49%, respectively, with a year-on-year change of +1.74pct/+0.94pct/+3.3pct/-1.83pct. Among them, the main reason for the increase in sales expenses was the company actively promoting international development strategies, setting up marketing outlets in major countries/regions, and participating in overseas sales exhibitions to expand brand awareness; the increase in R&D expenses was mainly due to the company's continuous promotion of new product development, continuous iteration of harmonic reducer products and development of a new generation of mechatronic and electro-hydraulic integration The product developed during the reporting period a serialized ultra-long-life, ultra-lightweight and ultra-compact harmonic reducer. It maintains the highest accuracy and lifespan in China, and also has the advantages of large load, high efficiency, and strong impact resistance.
The robot industry trend is clear, and the company will fully benefit as a core component supplier. In the long run, driven by factors such as the upgrading of manufacturing automation and changes in the global demographic structure, the robotics industry has broad scope for development. The company is a leading domestic harmonic speed reducer company. It is in a leading position in the country in terms of product performance, capacity layout, and customer development, and is expected to fully benefit from the accelerated industrialization of humanoid robots.
Investment advice: We expect the company to achieve net profit of 1.24/1.78/248 million yuan in 24-26 years, respectively, and the corresponding PE is 162/113/81 times, respectively. The company is a leading domestic harmonic speed reducer enterprise. It is in a leading position in terms of technology accumulation, capacity layout, and customer progress. It is expected to fully benefit from humanoid robot industry trends and has broad room for growth. First coverage with a “Recommended” rating.
Risk warning: risk of downstream demand fluctuation, risk of worsening competition pattern, humanoid robot industry progress falling short of expectations