CCTC(SZ:300408) SINOLINK SECURITIES·2024-07-21 11:00Investment Rating - The report maintains a "Buy" rating for the company, indicating an expected price increase of over 15% in the next 6-12 months [4][10]. Core Insights - The company has exceeded performance expectations, with a projected net profit of 9.50-10.97 billion RMB for H1 2024, representing a year-on-year growth of 30-50% [3]. - The growth in MLCC (Multi-Layer Ceramic Capacitors) products is accelerating, with significant improvements in various business segments, driven by increasing demand in consumer electronics and optical communications [3]. - The overall market for passive components is stable, with potential for price increases due to strong demand in home appliances and AI servers, as well as healthy inventory levels in the supply chain [3]. - The company is actively developing high-capacity and small-sized MLCCs, positioning itself to benefit from domestic market opportunities and the trend of import substitution [3]. Financial Forecast and Valuation - The projected net profits for 2024, 2025, and 2026 are 22.08 billion, 26.93 billion, and 31.72 billion RMB, respectively, with growth rates of 39.65%, 21.99%, and 17.77% [4]. - The current price-to-earnings (P/E) ratios are estimated at 27, 22, and 19 for the years 2024, 2025, and 2026 [4]. Business Performance Summary - The company reported a significant increase in revenue, with expected growth rates of 35.46% in 2024, 26.54% in 2025, and 20.41% in 2026 [8]. - The gross profit margin is projected to stabilize around 39.7% to 38.6% over the next few years, indicating a healthy profitability outlook [9]. - The return on equity (ROE) is expected to improve from 11.06% in 2024 to 13.18% in 2026, reflecting enhanced operational efficiency [8].