Sirui(688102) 国投证券·2024-08-22 07:09Investment Rating - The report maintains a "Buy-A" rating for the company with a 12-month target price of 10.9 RMB per share, implying a 25x PE multiple for 2025 [5][10] Core Views - The company's gross margin improvement highlights its profitability, with a focus on the growth potential of emerging businesses [1] - The company's revenue and net profit showed steady growth in H1 2024, with revenue reaching 624 million RMB (+11.48% YoY) and net profit at 56 million RMB (+6.28% YoY) [1] - The company is actively investing in new projects, including the construction of a liquid rocket engine thrust chamber materials and components production facility, with a total investment of 1.33 billion RMB [4][9] Financial Performance - Gross margin in H1 2024 was 23.80%, up 3.5 percentage points YoY, with Q2 gross margin reaching 24.33%, up 1.16 percentage points QoQ and 5.58 percentage points YoY [2] - R&D expenses in H1 2024 were 32.44 million RMB, up 30.61% YoY, accounting for 5.20% of revenue, an increase of 0.76 percentage points YoY [2] - Export revenue in H1 2024 was 173 million RMB, up 27.79% YoY, driven by growth in high-conductivity and high-strength copper alloy materials and components in the semiconductor and generator industries [2] Business Development - The company is expanding its presence in key markets such as the US, Europe, and Japan, particularly in the semiconductor and generator industries [2] - The company has made breakthroughs in new technology and product applications with major clients like Siemens and Schneider in the medium and high-voltage electrical contact materials sector [2] - The company is deepening its cooperation with industry leaders like Siemens and Varex in the CT and DR tube materials and components sector [2] Future Outlook - The company is expected to achieve revenue of 1.619 billion RMB, 2.071 billion RMB, and 2.693 billion RMB in 2024, 2025, and 2026, respectively, with net profits of 133 million RMB, 179 million RMB, and 250 million RMB [10] - The company's EPS is projected to be 0.18 RMB, 0.25 RMB, and 0.34 RMB for 2024, 2025, and 2026, respectively, with corresponding PE multiples of 39.2x, 29.2x, and 20.9x [10]