Zhejiang Jingsheng Mechanical & Electrical (300316) 光大证券·2024-08-21 08:12Investment Rating - Maintain "Buy" rating: The report maintains a "Buy" rating for the company, citing its leading position in the photovoltaic silicon wafer equipment sector, potential growth in semiconductor equipment and advanced materials, and a diversified business layout that supports long-term development [2] Core Views - Revenue growth: The company reported H1 2024 revenue of 10.147 billion yuan, a year-on-year increase of 20.71%, with Q2 revenue reaching 5.638 billion yuan, up 17.29% year-on-year [1] - Profit decline: Net profit attributable to shareholders in H1 2024 was 2.09 billion yuan, a year-on-year decrease of 4.97%, with Q2 net profit dropping 22.19% to 1.027 billion yuan [1] - Photovoltaic equipment innovation: The company continues to innovate in photovoltaic equipment, with new products such as tube-type PECVD, LPCVD, and ALD devices, achieving breakthroughs in battery equipment exports [1] - Semiconductor equipment localization: The company is accelerating the localization of semiconductor equipment, with increased orders for large silicon wafer and silicon carbide epitaxial equipment, and successful development of advanced products like 12-inch dry-in-dry-out edge polishers [1] - New materials business growth: The company is rapidly expanding its new materials business, particularly in silicon carbide substrates and sapphire materials, despite facing profit pressure in the photovoltaic materials sector [2] Financial Performance - Revenue and profit trends: The company's revenue growth rate has been declining, from 78.45% in 2022 to 11.71% in 2026E, while net profit growth is expected to stabilize around 14.96% by 2026E [3] - Profitability metrics: The company's ROE (diluted) is expected to decline from 30.46% in 2023 to 22.70% in 2026E, with a similar trend in ROA and ROIC [7] - Valuation: The company's PE ratio is projected to decrease from 12 in 2022 to 5 in 2026E, reflecting a more attractive valuation over time [3][7] Business Segments - Photovoltaic equipment: The company's photovoltaic equipment business achieved revenue of 7.368 billion yuan in H1 2024, a year-on-year increase of 20.64%, with a slight decline in gross margin to 37.43% [1] - Semiconductor equipment: The company is focusing on the localization of semiconductor equipment, with significant progress in silicon wafer and silicon carbide epitaxial equipment, and new products in advanced packaging [1] - New materials: The company is expanding its new materials business, particularly in silicon carbide substrates and sapphire materials, with rapid growth in production and shipments [2] Market Data - Market capitalization: The company's total market capitalization is 33.668 billion yuan, with a total share capital of 1.31 billion shares [5] - Stock performance: The stock's relative performance over the past year has been -41.90%, with a current price of 25.71 yuan [4]