Quectel(SH:603236) CSC SECURITIES (HK) LTD·2024-06-28 03:30Investment Rating - The report assigns a "BUY" rating for the company, with a target price of 55 RMB per share [3][6]. Core Insights - The company has faced significant pressure on its performance in 2023 due to industry conditions, but has recently seen a rebound in net profit by 140% in Q1 2024, driven by a recovery in downstream demand in the IoT sector. The emergence of new industries such as AIoT is expected to provide new growth momentum [3][16]. - The company has secured large overseas orders in the automotive sector, which are projected to enhance performance starting in 2026, with total sales estimated between 742 million to 1.309 billion USD over the project's lifecycle [4]. - The IoT industry is showing signs of recovery, with inventory levels normalizing and demand increasing in sectors like automotive and AIoT. The company, as a leading IoT module provider, is well-positioned to benefit from this recovery [7][16]. Financial Summary - The company's net profit for 2024 is projected to be 598.43 million RMB, with a year-over-year increase of 559.72%. EPS is expected to be 2.26 RMB, with a P/E ratio of 20 [10][18]. - Revenue is forecasted to grow from 13.86 billion RMB in 2023 to 16.88 billion RMB in 2024, reflecting a recovery in the market [12]. - The company has demonstrated effective cost control, with significant reductions in sales, management, and R&D expense ratios in Q1 2024 compared to the previous year [16].