Envicool(SZ:002837) Guotai Junan Securities·2024-07-12 09:31Investment Rating - The report maintains a "Buy" rating for the company [4][9]. - The target price is set at 28.57 CNY, with the current price at 22.31 CNY [9]. Core Insights - The company's performance in H1 2024 is expected to exceed expectations, with a projected net profit of 165-193 million CNY, representing a year-on-year growth of 80%-110% [4][3]. - The rapid growth in data center temperature control and the acceleration of electronic cooling solutions are highlighted as key growth drivers [4][3]. - The company has established a strong customer base in the data center sector, including major clients like Tencent and Alibaba, contributing to its growth [4][3]. Financial Summary - The company forecasts revenue growth from 3,529 million CNY in 2023 to 4,646 million CNY in 2024, reflecting a growth rate of 31.6% [18]. - Net profit is expected to increase from 344 million CNY in 2023 to 506 million CNY in 2024, a growth of 47.2% [18]. - Earnings per share (EPS) is projected to rise from 0.47 CNY in 2023 to 0.68 CNY in 2024 [18]. Business Development - The company is focusing on liquid cooling solutions, which are gaining traction due to the high-density heat generation in AI computing and data centers [4][3]. - The introduction of the Coolinside liquid cooling cabinet and comprehensive solutions is seen as a competitive advantage in the liquid cooling market [4][3]. - The company has optimized its product design and procurement strategies to mitigate the impact of rising raw material costs [4][3].