The business blossomed more often, and revenue and profit increased year-on-year
The company's 23H1 achieved revenue of 3,287 million yuan (yoy +21.51%), net profit of 390 million yuan (yoy +73.70%), net profit of 237 million yuan (yoy +35.79%) after deducting non-net profit of 237 million yuan (yoy +35.79%). Considering that the company's business has blossomed more and is compounded by the high increase in 23H1 investment income, we raised the company's net profit forecast values for 2023-2025 to 7.79, 10.14 billion yuan, and 1,311 billion yuan, respectively (previous values of 652, 9.53, and 1,287 billion yuan). Comparable companies, Wind, unanimously expected an average PE value of 30.7 times in '23. Considering the company's diversified business deployment, the company was given 36 times PE in 23, with a target price of 56.16 yuan (previous value of 39.30 yuan), maintaining the “buy” rating.
Deducting rapid growth in non-net profit, high return on investment
The company's 23H1 achieved revenue of 3,287 million yuan (yoy +21.51%), net profit of 390 million yuan (yoy +73.70%), net profit of 237 million yuan (yoy +35.79%) after deducting non-net profit of 237 million yuan (yoy +35.79%). Among them, a total of 153 million yuan was received from changes in fair value due to the increase in the valuation of investment companies. The company achieved revenue of 1,726 million yuan (yoy +14.17%, qoq +10.59%) and net profit of 229 million yuan (yoy +51.58%, qoq +42.07%) in Q2. The company's 23H1 gross/net interest rate was 25.03%/11.83% respectively, a change of +1.28pct/+3.08pct over the full year of '22. The company's 23H1 sales/management/R&D/financial expense ratio was 4.28%/2.71%/10.13%/0.00%, respectively. Compared with the full year change of '22, +0.11/0.09/-1.42/-0.39 pct, the total rate decreased by 1.61 pct.
Industrial automation products are growing rapidly, and smart home appliances & power products are growing steadily. The company's 23H1 industrial automation product sales revenue was 283 million yuan, an increase of 65.63%, accounting for 8.60%.
Electronic control products for smart home appliances achieved sales revenue of 1,398 million yuan, an increase of 22.33%, accounting for 42.53%, maintaining a good growth trend. China's smart bathroom market is still in the early stages of development, and there is still plenty of room for growth. Sales revenue of power products was 971 million yuan, an increase of 9.20%, accounting for 29.53%. In the first half of the year, the company's revenue growth rate for photovoltaic inverter component products rose sharply, there were sufficient orders on hand, and it began to achieve batch supply of core component products in the fields of portable energy storage, household storage, and industrial and commercial energy storage.
New customers continue to be developed, and the performance of new energy and rail transit is impressive
The company's 23H1 new energy and rail transit components sales revenue was 316 million yuan, up 43.76% year on year, accounting for 9.61%. Benefiting from the increase in demand from downstream customers and the implementation of the company's new product applications in various fields of passenger and commercial use, the company's business revenue has grown rapidly, and there are currently plenty of orders on hand. The company continues to develop new customers in the field of new energy vehicles. It has now established cooperation with automaker customers such as BAIC New Energy, Ningbo Feishi (applied to Nacha Auto), and Zero Sport. It continues to expand product demand in the commercial vehicle sector and achieve batch delivery, and the scale of business revenue is expected to continue to expand rapidly.
Risk warning: the impact of macroeconomic fluctuations; the speed of putting into production of new production capacity falls short of expectations; gross margin falls short of expectations.