Sungrow Power Supply(SZ:300274) Huachuang Securities·2024-08-26 14:49Investment Rating - The report maintains a "Strong Buy" rating for the company with a target price of 88.97 CNY, compared to the current price of 68.12 CNY [2]. Core Views - The company's profitability remains high, with overseas energy storage expected to continue to grow significantly [2]. - In H1 2024, the company achieved revenue of 31.02 billion CNY, a year-on-year increase of 8.38%, and a net profit attributable to shareholders of 4.96 billion CNY, up 13.89% year-on-year [2]. - The gross margin was 32.42%, an increase of 3.00 percentage points year-on-year, while the net profit margin was 15.99%, up 0.77 percentage points year-on-year [2]. Summary by Sections Revenue and Profitability - In Q2 2024, the company reported revenue of 18.41 billion CNY, a year-on-year increase of 14.74% and a quarter-on-quarter increase of 45.92% [2]. - The net profit for Q2 2024 was 2.86 billion CNY, a year-on-year increase of 0.57% and a quarter-on-quarter increase of 36.56% [2]. - The gross margin for Q2 2024 was 29.5%, down 1.03 percentage points year-on-year and down 7.17 percentage points quarter-on-quarter [2]. Product Performance - The company's photovoltaic inverter revenue in H1 2024 was 13.09 billion CNY, a year-on-year increase of 13%, with a gross margin of 37.6%, up 1.7 percentage points year-on-year [3]. - Global shipments reached 65 GW, a year-on-year increase of approximately 30% [3]. - The company has strengthened its global presence, particularly in Europe, America, Australia, and China, with over 490 service points worldwide [3]. Energy Storage Business - The energy storage system business generated revenue of 7.82 billion CNY in H1 2024, a year-on-year decrease of 8%, but the gross margin improved significantly to 40.1%, up 12.6 percentage points year-on-year [3]. - Global energy storage shipments reached 8 GWh, a year-on-year increase of approximately 60% [3]. - The company has secured significant contracts for energy storage projects in the Middle East, Latin America, Europe, and the UK, indicating strong future growth potential [3]. Future Outlook - The company is expected to maintain high profitability in 2024 due to rapid growth in its solar and storage business, cost control, and economies of scale [3]. - Projected net profits for 2024-2026 are 10.85 billion CNY, 12.11 billion CNY, and 13.27 billion CNY, respectively, with corresponding price-to-earnings ratios of 13, 12, and 11 times [4].