Incident: The company released its 2023 annual report. In 2023, it achieved revenue of 886 million yuan, an increase of 2.97% over the previous year, and net profit to mother of 305 million yuan, an increase of 10.10% over the previous year.
Strengthen R&D and innovation in cutting-edge technology and improve the company's talent team: in 2023, the company achieved operating income of 886 million yuan, +2.97% year over year, operating costs of 424 million yuan, -10.82% year on year, and net profit of 305 million yuan, +10.10% year on year. With the growth rate of the special electronic products industry slowing down, the company's overall performance was good, mainly due to the company's emphasis on independent research and development and implementation of talent management plans. In 2023, the company will strengthen independent research and development of core technologies and promote the development of main products in the direction of high integration, miniaturization and low cost. During the reporting period, the company invested 65.9094 million yuan in R&D expenses, an increase of 37.44% over the previous year. At the same time, the company applied for 9 new invention patents, obtained 7 authorized invention patents, and won honors such as “National Intellectual Property Advantage Enterprise”. In terms of talent management, the company actively expands introduction channels, selects technical and management-related talents, consolidates a long-term incentive mechanism, and lays a solid foundation for the company's future development.
The company implemented employee stock ownership plans and promoted the improvement of the incentive mechanism: In 2023, Leidian Weili issued a share repurchase plan with the intention of supporting restricted stock incentive plans and fully mobilizing the enthusiasm of the company's senior management and core talents to work. Prior to this equity incentive plan, two equity incentives had already been implemented, and a total of 12.1 million restricted shares were granted. This time, the equity incentive plan covered a wider range and was larger, accounting for about 6.94% of the company's total share capital when the draft incentive plan was announced.
The incentive program involved 162 employees, including incumbent senators, senior management, middle management, and core executives. This decision will effectively integrate shareholders' interests, company interests, and operators' individual interests, clarify the functions of different stakeholder groups, and promote the steady development of the company.
Low-altitude economic policies are favorable, and satellite internet is developing steadily: On April 10, 2024, seven departments including the National Development and Reform Commission, the General Administration of Market Supervision, and the Ministry of Emergency Management jointly issued the “Action Plan for Upgrading Towing Equipment Upgrades and Consumer Goods Trade-in”. The plan formulates standards such as drone flight tests, logistics drones, etc., to actively develop the low-altitude economy. The Ministry of Industry and Information Technology, the Civil Aviation Administration of China and other departments are responsible for related matters according to the division of responsibilities. On April 6, Hainan's first “satellite gigafactory” project went through the final verification stage, with an annual production capacity of up to 1,000 satellites in the future. Thunderbolt mainly develops radars, mobile communications and terminal equipment. Downstream products are developing well, and upstream and downstream linkages will drive the company's steady improvement in the future.
Profit forecast and investment rating: The company's performance is in line with expectations. Considering the broad prospects in the downstream application field and the leading position of the company's TR components, we lowered the company's 2024-2025 net profit forecast value to RMB 3.60/421 million (previous value: RMB 4.23/581 million yuan), respectively, and added the net profit forecast value for 2026 of RMB 491 million, corresponding to PE of 24/21/18 times, maintaining the “increase” rating.
Risk warning: 1) The release of the company's production capacity fell short of expectations due to external factors; 2) gross margin declined due to reduced military prices; 3) the replacement rate of new equipment fell short of expectations.