Kunshan Dongwei Technology (SH:688700) Changjiang Securities·2024-09-04 06:42Investment Rating - The investment rating for the company is "Buy" and is maintained [2]. Core Views - The company reported a revenue of 392 million yuan for H1 2024, a year-on-year decrease of 21.40%, and a net profit attributable to shareholders of 56 million yuan, down 45.53% year-on-year [2]. - The decline in revenue is primarily attributed to delays in the industrialization of composite fluid technology and lower-than-expected demand for equipment in the new energy sector [2][3]. - There are clear signs of recovery in the PCB industry, driven by trends such as miniaturization, high-layer count, flexibility, and intelligence, with AI servers and automotive electronics emerging as new growth drivers [2][3]. - The company is actively expanding its production capacity and has completed the construction of its Kunshan vacuum division factory, which will produce aluminum deposition equipment and magnetron sputtering equipment [3]. - The company is the only global player to achieve large-scale production of composite copper foil equipment, with significant first-mover advantages [3]. Summary by Sections Financial Performance - In H1 2024, the company achieved a revenue of 392 million yuan, a decrease of 21.40% year-on-year, and a net profit of 56 million yuan, down 45.53% year-on-year [2]. - For Q2 2024, revenue was 195 million yuan, a decline of 26.42% year-on-year and 1.41% quarter-on-quarter, with a net profit of 25 million yuan, down 52.20% year-on-year and 20.28% quarter-on-quarter [2]. Industry Outlook - The PCB industry is showing signs of recovery, with increasing orders for PCB-related equipment due to the growth in AI servers and automotive electronics [2][3]. - The company is well-positioned as a leading player in the PCB equipment market, covering nearly all of China's top 100 PCB companies [2][3]. Production Capacity and Development - The company is actively managing its production capacity to ensure timely delivery of PCB orders, benefiting from the investment boom in Southeast Asia and the growth of AI servers and electric vehicles [3]. - The industrialization of composite fluid technology is progressing, with composite aluminum foil already in application and expected to see increased market penetration [3]. Future Projections - The company expects net profits for 2024 and 2025 to be 166 million yuan and 247 million yuan, respectively, corresponding to PE ratios of 36.5 and 24.6 times [3].