EVE(SZ:300014) EBSCN·2024-07-11 08:02Investment Rating - The report maintains a "Buy" rating for the company, with a target price of 35.24 CNY [2][3] Core Views - The company's consumer battery segment is expected to benefit from the recovery in demand for electric two-wheelers and power tools, with small cylindrical batteries showing signs of price stabilization and potential growth [1] - The company's energy storage battery business is gaining momentum, with strong overseas competitiveness and a global ranking of second in energy storage cell shipments in Q1 2024 [1] - The company's large cylindrical battery production is progressing ahead of competitors, with substantial customer interest and orders secured for the next five years [1] Consumer Battery Segment - The demand for small cylindrical batteries is recovering, driven by the rebound in electric two-wheelers and power tools, with the company's production capacity fully utilized [1][19] - The company's consumer battery revenue exceeded 2 billion CNY in Q1 2024, with new capacity coming online and strong order visibility [1] - The company's investment in Smoore International, a leading e-cigarette manufacturer, continues to provide stable and substantial returns [1] Energy Storage Battery Segment - The company is targeting over 50GWh of energy storage battery shipments in 2024, with 60-70% of demand coming from overseas markets [1] - The company has secured strategic partnerships with global players like Powin, Wärtsilä, and ABS, including a 10GWh supply agreement with Powin [1] - The company is expanding its global footprint with energy storage projects in Malaysia and other regions, enhancing its competitive position in the global market [1][37] Large Cylindrical Battery Segment - The company has produced over 5.3 million units of its 46-series large cylindrical batteries as of January 2024, with several models already in mass production [1] - The company has secured customer interest for approximately 486GWh of large cylindrical battery demand over the next five years, covering its planned capacity expansion [1][41] Financial Performance and Valuation - The company's net profit for 2024-2026 is forecasted to be 5.22 billion CNY, 6.47 billion CNY, and 7.54 billion CNY, respectively, representing an upward revision of 8%, 7%, and 9% [2] - The current stock price implies a P/E ratio of 14x, 11x, and 10x for 2024-2026, indicating attractive valuation levels [2] - The company's ROE is expected to rebound, driven by improved operational efficiency and profitability in its core businesses [1][43]