Jia Yuan Technology(SH:688388) Xin Lang Cai Jing·2025-05-02 06:45Core Viewpoint - The company reported a significant decline in profitability for 2024, but showed a notable recovery in Q1 2025, indicating potential for future growth [1][2]. Financial Performance - In 2024, the company achieved revenue of 6.522 billion yuan, a year-on-year increase of 31.27%, but reported a net loss attributable to shareholders of 239 million yuan, a year-on-year decline of 1354.99% [1]. - For Q1 2025, the company generated revenue of 1.981 billion yuan, a year-on-year increase of 113.00% but a quarter-on-quarter decrease of 9.25%. The net profit attributable to shareholders was 24.46 million yuan, a year-on-year increase of 151.17% and a quarter-on-quarter increase of 125.79% [1][2]. - The overall gross margin for 2024 was 2.01%, down 3.82 percentage points year-on-year. However, in Q1 2025, the gross margin improved to 4.65%, with a net profit margin of 1.15%, reflecting a year-on-year increase of 4.56 and 6.33 percentage points respectively [2]. Business Strategy - The company is focusing on its core business while actively seeking diversification. It has increased its annual production capacity of advanced copper foil to over 110,000 tons, maintaining a leading position in the industry [3]. - The company is also pushing for a transformation towards production in its subsidiary, with revenue from high-performance copper wire exceeding 878 million yuan in 2024. It is exploring new technologies such as high-purity copper [3]. - The company is expanding its footprint in renewable energy, with 15.27 million kWh generated in the Meizhou area and winning a bid for a 69 MW solar project, while also venturing into wind power and energy storage [3]. Profit Forecast and Valuation - Based on the 2024 financial report, the processing fee for lithium battery copper foil is projected at 15,900 yuan per ton, indicating a significant decline. The overall gross margin is expected to decrease due to a soft copper foil capacity outlook for 2025-2026 [4]. - The company’s EPS for 2025-2027 is estimated to be 0.27, 0.61, and 0.96 yuan respectively, reflecting a downward revision of 56.5% and 29.9% from previous estimates [4]. - The projected BPS for 2025 is 16.46 yuan, with a target price set at 21.04 yuan, corresponding to a PB of 1.28 times, reflecting increased market risk appetite due to the company's diversification efforts [4].