DAHAO TECHNOLOGY(SH:603025) KAIYUAN SECURITIES·2024-07-05 05:30Investment Rating - The report maintains a "Buy" rating for the company, indicating expected strong performance relative to the market [3][18][28]. Core Views - The company is a leader in the electric control field for sewing and knitting equipment, with significant market share in products like embroidery machine control systems and sock machine control systems. The company is benefiting from strong domestic demand and export growth, leading to a recovery in the sewing machinery industry [3][18]. - The company anticipates a substantial increase in net profit for the first half of 2024, projecting a range of CNY 300-330 million, representing a year-on-year growth of 65.03% to 81.53% [2][3]. - The report highlights that the company's revenue is expected to grow significantly, driven by new product launches and strong demand in both domestic and international markets [4][5]. Financial Summary - The company’s projected financials for 2024-2026 include: - Net profit estimates of CNY 649 million, CNY 838 million, and CNY 1,027 million for 2024, 2025, and 2026 respectively, with year-on-year growth rates of 60.0%, 29.2%, and 22.5% [20]. - Earnings per share (EPS) are expected to be CNY 0.58, CNY 0.76, and CNY 0.93 for the same years [20]. - The company’s price-to-earnings (P/E) ratios are projected to be 23.6, 18.3, and 14.9 for 2024, 2025, and 2026 respectively [20]. Market Trends - The textile and apparel industry in China has seen a fixed asset investment increase of 14.8% year-on-year from January to May 2024. Additionally, the export value of sewing machinery products reached USD 302 million in May 2024, marking a year-on-year growth of 23.72% [19]. - The company is expanding its overseas service network, establishing eight offices in markets such as India, Pakistan, Vietnam, and Bangladesh, and extending its reach to emerging markets like Turkey, Algeria, and the UAE [19].