MINTH GROUP(425.HK):IN-LINE 1H24 WITH BETTER EARNINGS VISIBILITY AHEAD
MINTH GROUP(425.HK):IN-LINE 1H24 WITH BETTER EARNINGS VISIBILITY AHEAD
Earnings/Valuation. We revise up our FY24E net profit estimates by 3% to RMB2.3bn, as we raise gross margin assumption by 0.8ppts following its 1H24 beat. We also raise our FY25-26E net profit estimates by 4% and 3%, respectively, largely due to better margin outlook. We maintain our BUY rating and target price of HK$21.00, which is still based on 10x our revised FY24E EPS. Key risks to our rating and target price include lower revenue/margins, higher risks in overseas operation than we expect, as well as a sector de- rating.Maintain BUY. Minth's 1H24 net profit was in line with our forecast, coupled with strong free cash flow to cut its net debt level. The company plans to buy back shares and resume dividend distribution for FY24. That could make its dividend yield attractive given its current low valuation. Moreover, Minth's earnings visibility becomes even better with its capex cuts and new business expansion, in our view.
維持買入評級。海洋在1H24年淨利潤與我們的預測基本一致，加上強勁的自由現金流來削減其淨債務水平。公司計劃回購股票，並恢復FY24年的分紅派息。鑑於其當前低估值，這可能使其派息率具有吸引力。此外，在我們看來，海洋的盈利可見性進一步提高，其廠房投資減少，新業務的擴展。
1H24 earnings in line with improving operational efficiency. Minth's 1H24 revenue was 1% lower than our prior forecast while its gross margin of 28.5% beat our estimates by 1.2ppts. The beat at the gross profit level was offset by higher selling expenses than expected. That resulted in a net profit of RMB1.1bn in 1H24, or 0.2% lower than our prior forecast. Moreover, Minth's net debt level fell RMB0.9mn HoH to RMB3.3bn as of Jun 2024, reflecting its strong operating cash flow and self-disciplined capex.
1H24年盈利符合提高運營效率的預期。減運的1H24年營業收入比我們之前的預測低1%，而其28.5%的毛利率則超出我們的估計1.2個百分點。毛利潤的超額收益被高於預期的銷售費用所抵消。結果導致1H24年淨利潤爲人民幣11億元，比我們之前的預測低0.2%。此外，海洋的淨債務水平於2024年6月下降人民幣0.9億元至人民幣33億元，反映了其強勁的營業現金流和自律的廠房投資。
Dividends, capex and new businesses as key topics. Management is optimistic about achieving 20% YoY growth in net profit in 2H24, which probably gives management confidence in resuming dividend distribution for FY24 even with a share buyback plan. Should the company maintain its previous 40% payout ratio, the current dividend yield would be 7.8%. The company cut its FY24 capex guidance from RMB2.5-3.5bn to below RMB2.5bn, as it has been better utilizing its existing production lines, which gives us more confident about its earnings growth in the medium term, especially for the battery housing business. The company has also been accelerating new businesses by leveraging current resources, such as sub- frame, door sealing system and integrated intelligent exteriors. All these factors look positive to us.
分紅派息、廠房投資和新業務是關鍵話題。管理層對於在2H24年實現20%的淨利潤增長感到樂觀，這可能使管理層有信心在回購計劃下恢復FY24年的分紅派息。如果公司維持其之前的40%派息比率，當前的派息率將達到7.8%。公司將其FY24年度廠房投資指引從人民幣25-35億元降至人民幣低於25億元，因爲其更好地利用其現有的生產線，這使我們對其中期收益增長更有信心，尤其是對於電池外殼業務。公司還通過利用現有資源加快了新業務的發展，例如子框架，門密封系統和集成智能外觀。對我們來說，所有這些因素看起來都是積極的。
Earnings/Valuation. We revise up our FY24E net profit estimates by 3% to RMB2.3bn, as we raise gross margin assumption by 0.8ppts following its 1H24 beat. We also raise our FY25-26E net profit estimates by 4% and 3%, respectively, largely due to better margin outlook. We maintain our BUY rating and target price of HK$21.00, which is still based on 10x our revised FY24E EPS. Key risks to our rating and target price include lower revenue/margins, higher risks in overseas operation than we expect, as well as a sector de- rating.
收益/估值。我們將FY24E淨利潤預測上調3%至人民幣23億元，因爲我們在其1H24年的超預期表現後，將毛利率假設提高了0.8個百分點。我們還分別將FY25-26E淨利潤預測上調了4%和3%，主要是由於更好的毛利率展望。我們維持我們的買入評級和目標價爲21.00港元，仍基於我們修訂後的FY24E每股收益的10倍。我們的評級和目標價面臨的主要風險包括收入/毛利率的下降，境外業務風險高於我們的預期，以及行業的減持。
譯文內容由第三人軟體翻譯。
