Brief performance review
On April 23, 2024, the company disclosed its annual report and quarterly report. In 2023, it achieved revenue of 1.06 billion yuan, an increase of 40%; net profit to mother was 117 million yuan, a decrease of 24%. Among them, Q4 achieved revenue of 300 million yuan, an increase of 11%; realized net profit to mother of 0.32 million yuan, a decrease of 47%. The decline in performance was mainly due to equity incentive expenses, plus equity incentive expenses. In 2023, net profit to mother was 189 million yuan, an increase of 23%.
In Q1 2024, we achieved revenue of 270 million yuan, an increase of 16%; net profit to mother of 0.27 million yuan, a decrease of 17%. Q1 fell short of expectations.
Management analysis
Looking downstream, in 2023, the company's NEV business revenue was 600 million yuan, an increase of 55%; the revenue from the NEV wind power generation and energy storage business was 350 million yuan, an increase of 24%; and revenue from industrial control power supplies and other businesses was 60 million yuan, an increase of 51%. The new energy and industrial businesses are growing rapidly.
By product, the company's power fuse revenue in 2023 was 1 billion yuan, an increase of 37%, and incentive fuse revenue was 50 million yuan, an increase of 213%. The incentive fuse performance was outstanding. The company has a rich product range, with more than 120 product lines and more than 9000 product specifications.
By region, overseas business revenue in 2023 was 60 million yuan, an increase of 102%, accounting for 6%. The company's international NEV customers covered Tesla and Daimler. In October, the company announced that it received an exclusive global high-voltage high-voltage product (1000VDC) C-type order and a low-voltage product (70VDC) B-type order for a new model project on a pure electric platform from a leading German car company. The fixed amount is estimated at 9-1.2 billion yuan, and SOP is expected to begin in May 2025; in December, the company announced that it received a fixed target of 100 million yuan for high-voltage 1000VDC and 500VDC products from a leading German car company. The fixed amount is expected to be 110 million yuan, which is expected to be in January 2025 Start the SOP. Overseas locations highlight the company's product capabilities, and future overseas trips can be expected.
In terms of profitability, the company's gross profit margin in Q4 2023 and Q1 2024 was 41% and 38%, down 2.3 and 2.8 pcts from the same period last year. We expect the decline in gross margin mainly due to continued price cuts in the new energy industry chain.
Profit Forecasts, Valuations, and Ratings
Considering that the company's profitability declined more than expected, the company's net profit to mother in 2024 and 2025 was lowered to 160 to 210 million yuan (originally 300 to 360 million yuan), and the company's net profit to the mother is estimated to be 300 million yuan in 2026. The current price of the company's stock corresponds to a PE valuation of 39, 29, and 21 times, giving it a “buy” rating.
Risk warning
There are risks such as increased competition in the industry, demand for new energy vehicles, photovoltaic wind power, and energy storage falling short of expectations.