Tianneng Battery (SH:688819) Guoxin Securities·2024-09-11 06:08Investment Rating - The investment rating for the company is "Outperform the Market" [4][14]. Core Views - The company's performance in H1 2024 shows a steady growth in net profit, achieving 1.194 billion yuan, a year-on-year increase of 9%. Revenue for the same period was 21.622 billion yuan, remaining stable year-on-year [1][5]. - The lead-acid battery business is developing steadily, with a revenue of 20.137 billion yuan in H1 2024, a slight decrease of 1% year-on-year. The company is expanding its global footprint, including establishing an assembly plant in Vietnam [1][12]. - The electric bicycle replacement policy is expected to boost demand for lead-acid batteries, with government subsidies encouraging consumers to exchange old lithium-ion battery bicycles for new lead-acid battery models [1][12]. - The lithium battery business is under short-term pressure, with revenue dropping to 18.4 million yuan, a decrease of 50% year-on-year. However, the company is actively developing new products and expanding its market presence [1][12]. Summary by Sections Financial Performance - In H1 2024, the company achieved a net profit of 1.194 billion yuan, with a gross margin of 17.13%, down 1.83 percentage points year-on-year. The net profit margin was 5.57%, up 0.74 percentage points year-on-year [5][12]. - For Q2 2024, revenue was 12.294 billion yuan, a year-on-year increase of 14% and a quarter-on-quarter increase of 32%. The net profit for Q2 was 692 million yuan, a year-on-year increase of 46% and a quarter-on-quarter increase of 38% [5][12]. Business Segments - The lead-acid battery segment generated revenue of 20.137 billion yuan in H1 2024, with sales volume approximately 56.3 GWh, remaining stable year-on-year. The gross margin for this segment was 18.05%, showing a slight decline [1][12]. - The lithium battery segment faced challenges, with revenue of 18.4 million yuan and a gross margin of -7.54% in H1 2024. The company is focusing on product development and market expansion [1][12]. Future Outlook - The company has adjusted its profit forecast for 2024-2026, expecting net profits of 2.556 billion yuan, 2.776 billion yuan, and 3.025 billion yuan respectively, with year-on-year growth rates of 11%, 9%, and 9% [14][16]. - The current stock price corresponds to a price-to-earnings (PE) ratio of 10, 9, and 9 for the years 2024, 2025, and 2026 respectively [14][16].