Dynanonic(SZ:300769) Guotai Junan Securities·2024-09-03 02:38Investment Rating - The report maintains a "Buy" rating for the company [4]. Core Views - The company is facing significant pressure on its performance due to oversupply, intensified competition, and a sharp decline in lithium iron phosphate prices. However, new products such as lithium manganese iron phosphate and lithium replenishment agents are expected to gradually ramp up, potentially improving profitability [2][3]. Summary by Relevant Sections Financial Performance - For the first half of 2024, the company reported revenue of 4.341 billion yuan, a year-on-year decline of 51.2%, with a net profit attributable to shareholders of -516 million yuan, although losses have narrowed compared to the previous year. In Q2 2024, revenue was 2.449 billion yuan, down 38.0% year-on-year but up 29.4% quarter-on-quarter, with a net profit of -331 million yuan, indicating a widening loss compared to the previous quarter [3][4]. - The company's main product, phosphate-based cathode materials, saw production of 115,500 tons in H1 2024, a year-on-year increase of 31.23%, and sales of 105,800 tons, up 13.28% year-on-year. However, the decline in product prices due to raw material cost reductions and increased market competition has pressured profitability, leading to significant losses [3][4]. Product Development - The commercialization process of new products is accelerating, with lithium manganese iron phosphate having passed customer validation in 2022. In 2023, the first model featuring a "ternary lithium-ion + lithium manganese iron phosphate battery" was launched, and several new models are expected to be introduced in 2024, further enhancing the commercial viability of lithium manganese iron phosphate products. The company also launched a lithium replenishment agent that improves various performance metrics of lithium-ion batteries, which is anticipated to contribute to incremental revenue [3][4]. Valuation and Target Price - The report adjusts the earnings per share (EPS) forecast for 2024-2025 to -2.60 yuan and 0.83 yuan, respectively, with a projected EPS of 1.72 yuan for 2026. The company is valued at 1.31 times the price-to-book (PB) ratio based on comparable companies, leading to a target price of 30.01 yuan [3][4][10].