Huangma Technology(SH:603181) Orient Securities·2024-08-22 02:38Investment Rating - The report maintains a "Buy" rating for the company, with a target price of 12.60 CNY, reflecting a 20% premium over the comparable company's valuation of 15 times earnings for 2024 [2][4]. Core Insights - The company's mid-year performance shows significant growth, with a reported revenue of 1.009 billion CNY for the first half of 2024, representing a year-on-year increase of 23.65%. The net profit attributable to the parent company reached 191 million CNY, up 26.98% year-on-year. In Q2 alone, revenue was 577 million CNY, a 24.08% increase, and net profit was 103 million CNY, reflecting a 45.07% growth [1]. - The company's competitive edge is highlighted by its ability to recover from a significant drop in profits due to macroeconomic factors, with a return to profitability driven by product restructuring and new growth initiatives. The non-GAAP net profit for Q2 2024 rebounded to 103 million CNY [1]. - The company is expected to enter a new growth phase, supported by a recovery in industrial activity due to lower overseas energy costs and domestic policies promoting new production capabilities. The upcoming construction and production phase of the third factory is anticipated to further enhance growth prospects [1]. Financial Forecast and Valuation - Earnings per share (EPS) forecasts for 2024-2026 are projected at 0.70 CNY, 0.89 CNY, and 1.07 CNY respectively. The target price corresponds to an 18 times earnings multiple, reflecting the company's superior historical returns and growth certainty compared to peers [2][4]. - The company's revenue is expected to grow from 2.261 billion CNY in 2024 to 3.302 billion CNY by 2026, with corresponding net profits increasing from 414 million CNY to 630 million CNY over the same period [7][9].