Baolong Automotive(SH:603197) Xinda Securities·2024-08-31 03:06Investment Rating - The investment rating for Baolong Technology (603197.SH) is "Buy" [1] Core Views - The company's revenue for the first half of 2024 reached 3.18 billion yuan, a year-on-year increase of 21.7%, while the net profit attributable to shareholders was 150 million yuan, a year-on-year decrease of 19.4% [1] - The decline in net profit is primarily due to the impact of stock incentive expenses, which are expected to gradually decrease in subsequent quarters [1] - Traditional business segments are showing steady growth, while emerging businesses are maintaining high growth rates [1] Summary by Relevant Sections Financial Performance - In Q2 2024, the company achieved revenue of 1.70 billion yuan, a year-on-year increase of 19.0%, with a net profit of 80 million yuan, down 11.4% year-on-year [1] - The gross margin for Q2 was 25.08%, a decrease of 2.31 percentage points year-on-year and 4.37 percentage points quarter-on-quarter [1] - The net margin was 5.24%, down 1.35 percentage points year-on-year but up 0.64 percentage points quarter-on-quarter [1] Business Segments - The TPMS business generated revenue of 990 million yuan, up 19.7% year-on-year; the metal pipe fittings business generated 750 million yuan, up 8.4%; and the valve stem business generated 380 million yuan, up 5.1% [1] - Emerging businesses, including air suspension and sensor businesses, reported revenues of 420 million yuan (up 44.5%) and 310 million yuan (up 51.7%), respectively [1] - The emerging business revenue accounted for 13.56% and 9.92% of total revenue, an increase of 2.13 percentage points and 1.96 percentage points year-on-year, respectively [1] Future Outlook - The company is expected to see a gradual increase in net profit, with projections of 420 million yuan, 590 million yuan, and 780 million yuan for 2024, 2025, and 2026, respectively, corresponding to P/E ratios of 15, 11, and 8 times [1]