Xingyu Co.,Ltd(601799) ZHESHANG SECURITIES·2024-08-31 10:23Investment Rating - The report gives a "Buy" rating for the company, marking its first coverage [6][9]. Core Insights - The company is a leading domestic automotive lighting manufacturer, entering a new growth cycle driven by smart lighting technology. The automotive lighting industry is undergoing a significant upgrade from functional to intelligent systems, enhancing the competitiveness of domestic manufacturers [3][4]. - The market for intelligent automotive lighting is expected to grow rapidly, with a projected compound annual growth rate (CAGR) of over 20% in the next three years, reaching a market size of over 56 billion yuan by 2026 [3][4]. Summary by Sections Company Overview - The company has been deeply involved in the automotive lighting industry for 30 years, evolving from a local manufacturer to a leading player in the sector. It has successfully expanded its customer base to include both domestic and international brands [17][24]. - The company’s governance structure is concentrated, with the actual controller holding 54.3% of the shares [20][22]. Market Analysis - The penetration rate of intelligent headlights is currently low but is expected to increase significantly, driven by the demand for enhanced safety and interactivity in vehicles. The average value per vehicle for advanced lighting systems (ADB/DLP) is projected to increase by over 50% compared to traditional LED systems [3][4]. - The competitive landscape is shifting as traditional fuel vehicle manufacturers have established stable partnerships with lighting suppliers, while the rise of electric vehicles presents new opportunities for domestic lighting manufacturers to capture market share [3][4]. Growth Drivers - The company has been expanding its customer base, particularly focusing on new energy vehicle manufacturers. Since 2021, it has successfully entered the supply chains of several new energy vehicle brands [3][4]. - The company has also partnered with Huawei to enhance its product offerings in intelligent automotive lighting, which is expected to strengthen its competitive position in the market [3][4]. Financial Forecast and Valuation - The company’s projected revenues for 2024, 2025, and 2026 are 131.74 billion yuan, 161.00 billion yuan, and 195.60 billion yuan, respectively, with year-over-year growth rates of 28.5%, 22.2%, and 21.5% [4][9]. - The expected net profits for the same period are 15.04 billion yuan, 19.01 billion yuan, and 23.53 billion yuan, with corresponding year-over-year growth rates of 36.5%, 26.4%, and 23.8% [4][9].