DAYUAN PUMP(SH:603757) Tianfeng Securities·2024-09-01 10:06Investment Rating - The investment rating for the company is "Buy" with a maintained rating for the next six months [3]. Core Views - The company has shown a revenue recovery in Q2 2024, with a year-on-year increase of 4.30% to 570 million yuan, despite a decline in H1 revenue of 6.84% [1]. - The company is expected to accelerate growth in H2 2024 as the impact of inventory destocking in the European market weakens, supported by strong long-term demand for energy-saving products [1]. - The company has a diversified product matrix and strong technological capabilities, positioning it well for future growth [1]. Financial Performance Summary - For H1 2024, the company reported revenue of 840 million yuan, a decrease of 6.84% year-on-year, and a net profit attributable to shareholders of 140 million yuan, down 16.15% year-on-year [1]. - In Q2 2024, the gross profit margin was under pressure, decreasing by 5.0 percentage points to 28.2% due to raw material price fluctuations and changes in product mix [1]. - The company’s net profit margin for Q2 2024 was 17.6%, a decrease of 2.1 percentage points year-on-year [1]. Business Segment Performance - The residential pump segment generated approximately 305 million yuan in revenue for H1 2024, remaining flat year-on-year, while the industrial pump segment also reported stable revenue of about 130 million yuan [1]. - The liquid cooling pump business saw significant growth, with revenue of 28 million yuan in H1 2024, up 48% year-on-year, driven by new customer acquisitions [1]. - The company expects to achieve small batch orders in the second half of the year, particularly in the electric vehicle sector [1]. Earnings Forecast - The company’s projected net profits for 2024, 2025, and 2026 are 290 million yuan, 320 million yuan, and 380 million yuan respectively, reflecting a downward adjustment due to slower growth in key segments [1]. - The corresponding price-to-earnings ratios for 2024, 2025, and 2026 are estimated at 10.5x, 9.3x, and 7.9x respectively [1].