LY iTECH(SZ:002600)2024-07-17 03:00Investment Rating - The report maintains a "Buy" rating for the company, with a market price of RMB 7.64 and a sector rating of "Outperform" [1][4]. Core Views - The company is expected to face significant pressure in the first half of 2024, with a projected net profit of RMB 680 million to RMB 780 million, representing a year-on-year decline of 45.52% to 37.51%. The adjusted net profit, excluding non-recurring gains and losses, is expected to be between RMB 550 million and RMB 650 million, down 48.74% to 39.41% year-on-year [4]. - The decline in performance is attributed to changes in photovoltaic customer demand and intensified competition, which have negatively impacted the company's overall gross margin [4]. - The company is poised to benefit from the "hardware + AI" upgrade trend, with significant growth expected in AI-enabled devices such as smartphones and PCs from 2024 to 2027. This trend is anticipated to drive demand for components like cooling systems, chargers, and displays, where the company has established expertise [4]. - New business areas, including automotive and photovoltaic sectors, present substantial growth opportunities. The global market for power battery structural components is projected to reach RMB 76.813 billion by 2025, while the micro-inverter market is expected to grow from USD 3.15 billion in 2024 to USD 7.74 billion by 2029, with a compound annual growth rate of 19.7% [4]. Financial Summary - The company's revenue for 2024 is projected to be RMB 36.737 billion, reflecting a growth rate of 7.7%. By 2025 and 2026, revenues are expected to reach RMB 45.625 billion and RMB 53.059 billion, respectively, with growth rates of 24.2% and 16.3% [5][7]. - The net profit for 2024 is estimated at RMB 2.396 billion, with a growth rate of 16.8%. This is expected to increase to RMB 3.185 billion in 2025 and RMB 4.029 billion in 2026, with growth rates of 32.9% and 26.5% [5][8]. - The diluted earnings per share (EPS) is forecasted to be RMB 0.34 in 2024, RMB 0.45 in 2025, and RMB 0.57 in 2026, with corresponding price-to-earnings (P/E) ratios of 22.3, 16.8, and 13.3 [5][8].