Incident Overview

The company released its 2024 quarterly report.

Overseas markets continued to expand rapidly, and the Q1 revenue side achieved rapid growth. In 2024Q1, the company achieved revenue of 241 million yuan, +37.24% over the same period last year, better than previous market expectations. Against the backdrop of sluggish starts in the domestic wind power industry in the first quarter, the company still achieved significant growth on the revenue side, and individual stocks showed outstanding growth. We judge that on the one hand, the company has a lot of stock transformation needs. On the other hand, it is the rapid expansion of overseas markets. Overseas revenue in 2023 was 542 million yuan, +74% over the same period last year, which can be further verified. Looking ahead to the full year of 2024, on the one hand, domestic demand for wind power is expected to continue to improve marginally, and on the other hand, the company's revenue side is expected to continue the rapid growth trend.

Q1 The fee rate fell rapidly, and the net interest rate increased dramatically

2024Q1's net profit to mother and net profit after deduction were 5838 million yuan and 51.99 million yuan respectively, +285.87% and +349.93%, respectively. The profit side greatly exceeded market expectations. 2024Q1's net sales interest rate and net profit margin after deducting non-sales were 24.27% and 21.62%, respectively, compared with +15.64 and +15.03pct, respectively, and the profit level increased significantly. 2024Q1 gross sales margin was 46.56%, -1.95pct YoY. The expense ratio during the 2024Q1 period was 22.45%, -18.59pct year on year, the main reason for the increase in net interest rates. Among them, sales, management, R&D and financial expenses ratios were -8.75, -1.55, -6.19, and -2.09pct, respectively. This is mainly due to the fact that the company began expanding new businesses such as non-wind power in 2023. Expenses were invested heavily, and the subsequent expense ratio is expected to gradually decline, driving the net interest rate to rise further.

Overseas market expansion & product expansion open up the company's medium- to long-term growth space 1) Overseas business is growing rapidly, and there is still plenty of room for improvement. The overseas wind power aerial work equipment market is larger than the domestic market. The company's products have obtained relevant overseas certifications, and there is still plenty of room for improvement in overseas revenue; 2) Continuously enrich and improve the product line, and the room for growth continues to open up. In the field of wind power, in order to adapt to high tower cylinders, the company introduced a dual-engine linkage solution (lift+no crawler); in order to adapt to the development of flexible towers, hybrid towers, and floating fans, the company developed and launched products such as heavy-duty elevators and rack and pinion lifts. In addition, the company is actively developing new products, such as material carriers, tower cranes, etc., and is actively expanding new fields such as construction, communications, hydropower, bridges, and fire protection, which is expected to contribute to new growth points in performance.

Investment advice

Considering the increase in the company's profit level, we maintained our 2024-2026 revenue forecasts of 1,475, 18.99, and 2,356 million yuan, respectively; adjusted net profit to mother for 2024-2026 was 2.95, 3.86, and 504 million yuan (original values 2.71, 3.57, and 461 million yuan), respectively, +43%, +31%, and +30% year-on-year, and 2024-2026 EPS was 1.94, 2.55, and 3.32 yuan, respectively (original Values of 1.79, 2.35, and 3.04 yuan), the 2024/4/28 stock price of 40.45 yuan corresponds to PE of 21, 16, and 12 times. Considering the company's strong growth, it maintains an “gain” rating.

Risk warning

New business expansion fell short of expectations, profit levels declined, wind power installations fell short of expectations, etc.