TOSPO(603303) 国信证券·2024-08-18 01:07Investment Rating - The investment rating for the company is "Outperform the Market" [1][3][11] Core Views - The company experienced a revenue decline in Q2 2024, with a 21.6% year-over-year decrease, but managed to improve its profitability, achieving a net profit of 1.03 billion yuan, up 4.7% year-over-year [1] - The company is actively adjusting its revenue structure to enhance operational quality, focusing on increasing the sales proportion of high-value lighting products while reducing exposure in high-risk markets [1] - The automotive lighting business faced short-term pressure, but new project approvals are expected to drive future growth [1] Summary by Sections Financial Performance - In H1 2024, the company reported revenue of 21.4 billion yuan, down 12.7% year-over-year, and a net profit of 1.8 billion yuan, up 8.1% year-over-year [1] - The Q2 revenue was 10.6 billion yuan, reflecting a 21.6% decline, while the net profit was 1.03 billion yuan, showing a 4.7% increase [1] - The gross profit margin in Q2 improved by 4.2 percentage points to 21.5% due to a strategic shift in business structure [1] Revenue Structure and Market Strategy - The company adjusted its product mix and market strategy, leading to a decline in revenue but stable net profit performance [1] - The export growth rate of lighting products in China showed a decline in Q2, with a 1.6% decrease, while H1 exports increased by 3.4% to 20.6 billion USD [1] - The company anticipates a stabilization and potential recovery in its general lighting revenue in H2 2024 as the export base decreases [1] Automotive Lighting Business - The automotive lighting segment's revenue decreased by 10.6% to 2.9 billion yuan in H1 2024, with a notable decline in revenue from structural components [1] - The company secured new project approvals worth nearly 900 million yuan, including orders from major clients like NIO and Valeo [1] - The automotive business is expected to return to a growth trajectory as new projects convert into revenue [1] Cost and Profitability - The company increased its investment in R&D and operational expenses, with Q2 R&D expenses rising by 1.1 percentage points to 4.2% of revenue [1] - The net profit margin improved by 2.4 percentage points to 9.8% in Q2 due to reduced losses from fair value changes and asset impairments [1] - The company has adjusted its business structure to enhance profitability despite increased costs [1] Earnings Forecast - The profit forecast for 2024-2026 has been revised downwards, with expected net profits of 4.0 billion, 4.5 billion, and 4.9 billion yuan respectively, reflecting year-over-year growth of 8%, 12%, and 8% [1][2]