GONGNIU(SH:603195) Guoxin Securities·2024-09-02 12:32Investment Rating - The investment rating for the company is "Outperform the Market" [4][12]. Core Views - The company demonstrated solid revenue growth and profit enhancement through non-operating income, reflecting operational resilience. In H1 2024, the company achieved revenue of 8.39 billion (+10.5%) and a net profit attributable to shareholders of 2.24 billion (+22.9%) [1][2]. - The company is focusing on expanding its product lines in the electric connection and smart electrical sectors, with significant growth in new energy products, which saw a revenue increase of 120.2% in H1 2024 [1][3]. - The internationalization strategy remains strong, with overseas revenue reaching 140 million (+71.6%) in H1 2024, indicating successful market penetration in Southeast Asia and other regions [1][3]. Summary by Sections Financial Performance - In H1 2024, the company reported a revenue of 83.9 billion, with a net profit of 22.4 billion and a non-deductible net profit of 19.0 billion, reflecting a year-on-year growth of 10.5%, 22.9%, and 14.3% respectively [1][2]. - The second quarter (Q2) results showed a revenue of 45.8 billion (+7.6%) and a net profit of 13.1 billion (+20.6%) [1][2]. Business Segments - Electric connection segment revenue was 38.7 billion (+5.2%), with new product launches targeting diverse consumer needs [1][3]. - Smart electrical lighting segment revenue reached 42.1 billion (+11.7%), with continued growth in wall switch business and effective brand operations [1][3]. - New energy segment revenue was 2.89 billion (+120.2%), with a focus on expanding product offerings and increasing channel coverage [1][3]. Profitability and Margins - The gross margin for Q2 was 43.6% (+0.4 percentage points), driven by internal efficiency improvements and favorable raw material costs [1][3]. - The net profit margin for Q2 was 28.5% (+3.1 percentage points), with investment income contributing positively to profits [1][3]. Future Projections - The company adjusted its profit forecasts, expecting net profits of 4.32 billion, 4.89 billion, and 5.51 billion for 2024, 2025, and 2026 respectively, with year-on-year growth rates of 12%, 13%, and 13% [1][2]. - The diluted EPS is projected to be 4.85, 5.48, and 6.18 for the same years, with corresponding P/E ratios of 14, 12, and 11 [1][2].