NBJF(SH:603997) Tianfeng Securities·2024-07-07 01:30Investment Rating - The report gives a "Buy" rating for the company, with a target price range of 11.55 to 13.2 CNY for 2024, based on a PE valuation of 35-40 times [9]. Core Viewpoints - The company is a leading domestic automotive seat assembly enterprise, with expected growth in seat business volume. The integration of Grammer is showing positive results, and the company is positioned to benefit from the increasing demand in the automotive sector [7][18]. - The company has diversified its product offerings and customer base, enhancing its market position and profitability potential. The integration of Grammer has led to improved operational efficiency and cost reduction strategies [19][20]. Summary by Sections Financial Data and Valuation - The company is projected to achieve net profits of 419 million, 826 million, and 1.238 billion CNY for 2024, 2025, and 2026 respectively, with corresponding PE ratios of 31, 16, and 10 times [9]. - In 2023, the company reported a revenue of 21.57 billion CNY, a year-on-year increase of 20.06%, and a net profit of 203.87 million CNY, marking a significant recovery from previous losses [10][38]. Business Development - The company has a rich history in the automotive seat components industry, having expanded its product matrix significantly after acquiring Grammer in 2019. This acquisition has allowed the company to enter the passenger car seat assembly market successfully [17][18]. - The company is transitioning from a Tier 2 supplier to a Tier 1 seat assembly supplier, significantly increasing the value per vehicle from 400-500 CNY to 5000-6000 CNY [20]. Operational Efficiency - The company has implemented various cost-reduction measures post-acquisition of Grammer, leading to improved profit margins. The gross profit margin increased to 14.75% in 2023, up from 13.09% in the previous year [42]. - The operational integration of Grammer has resulted in a more efficient supply chain and production process, contributing to the company's overall profitability [19][20]. Market Position - The company has established a diverse customer base, including partnerships with both traditional and new energy vehicle manufacturers, which enhances its market resilience and growth potential [33][18]. - The company is well-positioned to capitalize on the growing demand for automotive seats, particularly in the context of the shift towards electric vehicles and the increasing focus on supply chain security [20][18].