YDC(SH:605555) Minsheng Securities·2024-08-16 13:30Investment Rating - The report gives a "Buy" rating for the company, with a target price of 15.97 CNY [5]. Core Insights - The company has a diversified business model focusing on home appliances and automotive components, with a strong growth potential driven by its core business in vacuum cleaner motors and expanding into small home appliances and automotive EPS motors [1][7]. - The company has established a long-term strategic partnership with TTI, a leading vacuum cleaner manufacturer, which significantly contributes to its revenue, accounting for over 50% of sales in 2023 [1][2]. - The small home appliance segment has shown remarkable growth, with a CAGR of 82.82% from 2019 to 2023, and revenue reached 822 million CNY in 2023 [2]. - The automotive EPS motor business is gaining traction, with over 5 billion CNY in orders and production capacity expected to ramp up significantly [3][4]. Summary by Sections 1. Business Overview - The company has transitioned from focusing solely on vacuum cleaner motors to a multi-faceted business model that includes small home appliances and automotive EPS motors, establishing a robust operational framework [7][8]. - The revenue from vacuum cleaners remains the largest segment, contributing 58.78% of total revenue in 2023, while small appliances and automotive components account for 29.63% and 7.26%, respectively [10][14]. 2. Home Appliance Segment - The vacuum cleaner market is expected to continue its growth trajectory, with a recovery in exports and a stable demand for various types of vacuum cleaners [21][24]. - The company has successfully expanded its product offerings in the small appliance sector, collaborating with new clients and introducing innovative products [2][14]. 3. Automotive Components - The company has made significant advancements in the automotive EPS motor sector, with a focus on domestic market penetration and a strong order backlog exceeding 5 billion CNY [3][4]. - The production capacity for automotive motors is set to increase, with several production lines under construction and expected to be operational soon [3][4]. 4. Financial Projections - The company is projected to achieve revenues of 37.86 billion CNY, 47.08 billion CNY, and 55.57 billion CNY for the years 2024, 2025, and 2026, respectively, with corresponding net profits of 4.15 billion CNY, 5.19 billion CNY, and 6.41 billion CNY [4][5].