GONGNIU(SH:603195) Guolian Securities·2024-09-01 08:03Investment Rating - The investment rating for the company is "Buy" (maintained) [7][10] Core Views - Since the weakening of the real estate environment in 2022, the company's quarterly revenue growth has never been below 7%, mostly remaining in double digits. Profit performance has been even more outstanding, with digitalization and cost reduction contributing to continuous improvement in gross and net profit margins for seven consecutive quarters since Q4 2022. Despite a weak environment, the company's operational strength is robust, outperforming expectations [3][10]. Summary by Relevant Sections Financial Performance - In H1 2024, the company achieved revenue of 8.386 billion, a year-on-year increase of 10.45%, and a net profit attributable to shareholders of 2.239 billion, up 22.88%. In Q2 2024, revenue was 4.583 billion, a year-on-year increase of 7.64%, with a net profit of 1.309 billion, up 20.58% [10][11]. - The company’s gross margin improved in Q2, with a year-on-year increase of 0.4 percentage points. The company demonstrated strong raw material price-locking capabilities, maintaining gross margin improvement despite a high base in the same period [10][14]. Business Segments - The converter business remained stable, with a year-on-year revenue growth of 5%. The company launched electric tools in the domestic market, expected to contribute incrementally. The smart electrical lighting business saw a year-on-year revenue increase of 12%, although growth slowed in Q2 due to its high correlation with real estate [10][11]. - The new energy business maintained high growth, with a year-on-year increase of 120% to 290 million, accounting for 3% of total revenue [10][11]. Future Outlook - The company is expected to achieve revenues of 17.3 billion, 19.3 billion, and 21.5 billion in 2024, 2025, and 2026, respectively, with year-on-year growth rates of 10%, 12%, and 12%. Net profits attributable to shareholders are projected to be 4.5 billion, 4.9 billion, and 5.6 billion for the same years, with corresponding PE ratios of 20, 18, and 16 [10][11].