Desay SV(SZ:002920) Tianfeng Securities·2024-08-23 10:00Investment Rating - The report assigns a "Buy" rating for the company, with a target price of 129.85 CNY for 2024, based on a PE ratio of 35X [2][3]. Core Insights - The company is positioned as a leader in the domestic domain controller market, benefiting from the high demand for automotive intelligence and the ongoing construction of overseas factories to enhance revenue [2][36]. - The company has achieved significant revenue growth, with a projected increase in revenue from 285.70 billion CNY in 2024 to 442.80 billion CNY in 2026, alongside a steady rise in net profit [2][36]. - The collaboration with NVIDIA has strengthened the company's position in the intelligent driving sector, enabling the development of advanced domain controllers [31][34]. Summary by Sections Company Overview - The company has evolved from a focus on automotive audio systems to becoming a leader in intelligent automotive electronics, particularly in smart cockpits and intelligent driving [8][11]. - The ownership structure is stable, with significant shares held by local state-owned enterprises [9]. Market Demand and Policy Support - The demand for intelligent automotive products is increasing, driven by supportive government policies aimed at enhancing the penetration of smart vehicles [19][20]. - The market for autonomous driving is projected to grow significantly, with the scale of the market expected to reach 3,832 billion CNY by 2024 [22]. Product Development and Innovation - The company has launched differentiated smart cockpit solutions and has established a comprehensive product matrix, including collaborations with Qualcomm and self-developed platforms [29][34]. - The intelligent driving segment has seen rapid growth, with new project orders contributing to a significant increase in revenue [13][36]. Financial Performance - The company reported a revenue of 21.91 billion CNY in 2023, a 46.71% increase year-on-year, with a compound annual growth rate of 47.70% from 2020 to 2023 [13][36]. - The gross margin for the intelligent driving segment has faced pressure due to increased competition, but overall financial stability is maintained [15][17]. Global Expansion - The company has successfully penetrated international markets, securing new project orders from major clients such as AUDI and TATA MOTORS, with overseas revenue reaching 1.64 billion CNY in 2023 [34]. - The establishment of new factories in Mexico and plans for expansion in Europe are expected to enhance production capacity and support growth in overseas markets [34].