TINCI(SZ:002709) Soochow Securities·2024-08-28 00:03Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The company's mid-year performance for 2024 met expectations, with revenue of 5.45 billion yuan, down 32% year-on-year, and a net profit of 238 million yuan, down 82% year-on-year, with a gross margin of 19%, down 11 percentage points [3] - The company continues to increase its market share in the electrolyte segment, with Q2 2024 shipments exceeding 110,000 tons, and total shipments for the year expected to reach nearly 500,000 tons, representing a year-on-year growth of over 20% [3] - The profitability of the electrolyte segment has reached a bottom, with Q2 2024 profits estimated at 100 million yuan, and unit profits expected to stabilize in Q3 2024 [3] Summary by Sections Financial Performance - For H1 2024, the company reported a revenue of 5.45 billion yuan, a decrease of 32% year-on-year, and a net profit of 238 million yuan, a decrease of 82% year-on-year, with a gross margin of 19% [3] - Q2 2024 revenue was 3 billion yuan, with a year-on-year decrease of 19% and a quarter-on-quarter increase of 21% [3] - The company expects to achieve a total shipment of 500,000 tons of electrolytes in 2024, with a year-on-year growth of over 20% [3] Profitability and Market Position - The company’s Q2 2024 electrolyte profit was approximately 100 million yuan, with unit profit per ton around 800 yuan, indicating a slight decline [3] - The company’s market share in the electrolyte segment continues to rise, with Q2 2024 shipments expected to be around 110,000 tons, a quarter-on-quarter increase of over 20% [3] Cost Control and Cash Flow - The company maintained good cost control, with H1 2024 expenses at 750 million yuan, a decrease of 5% year-on-year, and a Q2 expense rate of 12% [4] - Operating cash flow for H1 2024 was 360 million yuan, a decrease of 45% year-on-year, with Q2 cash flow showing a significant increase of 1455% [4] Earnings Forecast and Valuation - The company’s net profit forecasts for 2024-2026 are 610 million yuan, 1.5 billion yuan, and 2.26 billion yuan respectively, with corresponding P/E ratios of 43, 17, and 12 times [4] - Given the company is at the bottom of the cycle, future price recovery could lead to significant profit elasticity, thus maintaining a "Buy" rating [4]