Wetown Electric(688226) 天风证券·2024-07-21 08:30Investment Rating - The report assigns a "Buy" rating for the company with a target price of 21.5 CNY, based on an estimated PE of 18 times for 2024 [77][78]. Core Insights - The company is positioned to benefit from the rapid growth in the energy transition and the increasing demand for renewable energy solutions, particularly in the photovoltaic and energy storage sectors [9][87]. - The global photovoltaic market is expected to see significant growth, with new installations projected to reach 574 GW in 2024, leading to increased demand for related materials such as welding strips [2][31]. - The company has established a comprehensive product matrix in the energy storage sector, providing customized solutions that enhance grid stability and flexibility [5][9]. Summary by Sections Market Overview - The global energy transition is irreversible, with the energy storage market experiencing a compound annual growth rate (CAGR) of 108% from 2019 to 2023, and a projected CAGR of 23% from 2024 to 2030 [9][10]. - The photovoltaic welding strip market is expected to grow significantly, with total market size projected to reach 297.56 billion CNY by 2024, reflecting a year-on-year growth of 39.17% [2][23]. Competitive Landscape - The welding strip industry in China is characterized by a relatively low concentration, with the top three companies holding a combined market share of only 27.5% [3][4]. - The company is one of the leading suppliers in the photovoltaic welding strip market, with a strong focus on innovation and product development [56][74]. Financial Performance - The company achieved a revenue of 2.85 billion CNY in 2023, representing a year-on-year increase of 74%, with a projected revenue of 4.11 billion CNY in 2024 [23][75]. - The net profit attributable to the parent company is expected to grow from 1.9 billion CNY in 2024 to 3.5 billion CNY in 2026, reflecting a robust growth trajectory [23][77]. Product Development - The company has made significant advancements in its photovoltaic welding strip technology, including the development of SMBB and 0BB welding strips, which enhance efficiency and reduce costs [61][74]. - The company has a strong R&D focus, with a notable increase in R&D expenditures, positioning it well within the competitive landscape [56][67]. Strategic Initiatives - The company is actively expanding its international presence, particularly in the energy storage sector, and has established partnerships to enhance its market reach [19][76]. - The company is leveraging its technological capabilities to develop smart grid solutions, aligning with the increasing demand for intelligent energy management systems [50][52].