NJEC(SH:600699) Shanxi Securities·2024-09-11 13:00Investment Rating - The report maintains a "Buy-A" rating for the company, indicating an expected price increase of over 15% relative to the benchmark index within the next 6-12 months [3]. Core Insights - The company has demonstrated strong growth in its automotive safety business, with a significant increase in new orders, particularly in the new energy sector, which accounted for over 60% of new orders in the first half of 2024 [2]. - The company's revenue for H1 2024 reached 27.08 billion yuan, a year-on-year increase of 0.24%, while the net profit attributable to shareholders was 640 million yuan, up 33.9% year-on-year [1][2]. - The gross margin for H1 2024 was reported at 15.5%, an increase of 2.1 percentage points year-on-year, reflecting improved profitability across its business segments [2]. Financial Performance Summary - The company achieved a total revenue of 49.793 billion yuan in 2022, with projections of 55.728 billion yuan for 2023 and 60.625 billion yuan for 2024, indicating a compound annual growth rate (CAGR) of approximately 8.8% from 2023 to 2024 [4]. - The net profit for 2022 was 394 million yuan, with projections of 1.083 billion yuan for 2023 and 1.558 billion yuan for 2024, reflecting a significant growth trajectory [4]. - The company's gross margin is expected to improve from 15.1% in 2023 to 16.2% in 2024, indicating enhanced operational efficiency [4]. Order and Production Insights - The company secured new orders worth approximately 50.4 billion yuan in H1 2024, with the automotive safety segment contributing over 45 billion yuan of this total [2]. - The production capacity for automotive safety components is set to increase significantly, with the completion of a new facility expected to produce 4 million steering wheels and 10 million airbags annually [2]. Valuation Metrics - The projected price-to-earnings (P/E) ratios for 2024, 2025, and 2026 are 12.8, 9.6, and 7.6 respectively, suggesting that the stock is undervalued relative to its earnings growth potential [3][4]. - The return on equity (ROE) is expected to rise from 6.5% in 2023 to 8.9% in 2024, indicating improved profitability and efficiency in utilizing shareholder equity [4][6].