CAERI(601965) Tebon Securities·2024-08-28 00:03Investment Rating - The report maintains a "Buy" rating for China Automotive Research (601965.SH) [2] Core Views - The company demonstrates steady growth with improving profitability, achieving a revenue of 2 billion yuan in the first half of 2024, a year-on-year increase of 20.38%, and a net profit of 401 million yuan, up 16.88% year-on-year [5][6] - The company is focusing on its strategic advantages in automotive technology services and emerging businesses, with a notable revenue increase in the new energy and intelligent connected vehicle development and testing business, which grew by 38.09% [5][6] - The integration with China Inspection Group is expected to accelerate growth by leveraging resources and capabilities in the automotive inspection and certification sectors [6] Financial Performance Summary - In the first half of 2024, the company reported a revenue of 2 billion yuan, with a net profit of 401 million yuan, and a non-recurring net profit of 377 million yuan [5] - The second quarter of 2024 saw a revenue of 1.139 billion yuan, reflecting a year-on-year growth of 19.31% and a quarter-on-quarter growth of 32.2% [5] - The company's gross margin for the first half of 2024 was 40.6%, with a net margin of 21.6% [5][8] - Revenue projections for 2024-2026 are estimated at 47.2 billion yuan, 55.6 billion yuan, and 65.6 billion yuan, respectively, with corresponding net profits of 9.9 billion yuan, 11.8 billion yuan, and 14.1 billion yuan [6][9] Market Comparison - The company's stock has underperformed relative to the market, with a 20% decline compared to the CSI 300 index [4] - The stock price range over the past 52 weeks was between 15.06 and 23.04 yuan [7] Valuation Metrics - As of August 27, 2024, the stock price was 15.50 yuan, with projected P/E ratios for 2024, 2025, and 2026 at 15.7, 13.2, and 11.1, respectively [6][9] - The company maintains a gross margin of 43% and a net profit margin projected to improve to 22.5% by 2026 [8][9]