Incident: The company released its 2024 semi-annual report. 2024H1 achieved operating income of 0.906 billion yuan, up 34.40% year on year, and achieved net profit of 0.236 billion yuan, up 35.51% year on year; 2024Q2 achieved operating income of 0.455 billion yuan, up 39.51% year on year, and achieved net profit of 0.101 billion yuan, up 25.12% year on year.
Onhand orders have been increasing steadily, and we have entered a period of intensive equipment delivery.
In terms of contract liabilities: As of the end of the second quarter of 2024, the company's contract debt was 1.905 billion yuan, an increase of 37.79% year over year and a decrease of 3.32% from 2024Q1. We believe it was affected to a certain extent by the slowdown in downstream capital expenditure.
In terms of inventory: As of the end of the second quarter of 2024, the company's inventory was 1.979 billion yuan, up 37.03% year on year and down 1.74% from 2024Q1. The company's inventory size declined after entering an intensive equipment delivery period.
Furthermore, the company accelerated its expansion in overseas markets. 2024H1 achieved revenue of 0.137 billion yuan outside of mainland China, an increase of 131.48% over the previous year. The subsequent expansion of production capacity for overseas downstream customers is expected to contribute new performance increases to the company.
The scale of R&D investment remains high, and breakthroughs in technology in the non-photovoltaic industry continue to be achieved.
The company continued to increase investment in R&D and innovation. 2024H1 R&D expenses increased 44.56% year on year to 0.14 billion yuan, accounting for 1.08 pct to 15.41% year on year. Non-photovoltaic industry companies are actively expanding their technology. Shipments of panel-level glass substrate through-hole equipment have been completed during the reporting period, achieving full coverage of wafer-level and panel-level TGV packaging laser technology.
Maintaining a “buy” rating: The capital expenditure of domestic companies has weakened against the backdrop of profit pressure in the photovoltaic industry. We lowered our profit forecast. The company's net profit forecast for 2024-26 is 0.634/0.762/0.915 billion yuan (down 6%/9% down), and the current stock price is 19 times PE in 2024. The company has sufficient orders in hand, and has technical reserves for TopCon, HJT, IBC, perovskite, and metallization. After achieving breakthroughs in laser processing equipment in the non-photovoltaic industry (high-end consumer electronics, integrated circuits, etc.), it is expected to provide new performance increases and maintain a “buy” rating.
Risk warning: the risk of raw material price fluctuations, the risk of downstream demand fluctuations, and the risk of increased market competition.