DOUSON(603800) 华泰证券·2024-09-19 04:03Investment Rating and Target Price - The report initiates coverage on Daoshen Co Ltd (603800 CH) with a "Buy" rating and a target price of RMB 19.44, based on a 2024 PE multiple of 18x [1][5] Core Investment Thesis - Daoshen Co Ltd, traditionally an oil and gas equipment manufacturer, has transformed into a new energy enterprise through the acquisition of Hongtian Technology, a leading domestic lithium battery copper foil equipment manufacturer [1][9] - The company is accelerating its layout in composite current collector equipment, with 2023 revenue reaching RMB 2.237 billion (+2.18% YoY) and net profit attributable to shareholders of RMB 205 million (+92.38% YoY) [1] - The composite current collector industry is expected to see accelerated industrialization, with one-step equipment costs approaching two-step methods and further cost reductions possible [1][9] - The automotive sector is expected to be the first to adopt composite current collectors, while the energy storage sector offers significant future growth potential [2][9] - Hongtian Technology, a subsidiary, is a traditional lithium battery copper foil equipment leader with a 30% market share in 2022, and is now focusing on one-step composite foil equipment [3][10] Financial Forecasts and Valuation - Revenue is expected to grow from RMB 2.237 billion in 2023 to RMB 2.749 billion in 2026, with net profit attributable to shareholders projected to increase from RMB 205 million to RMB 319 million over the same period [4] - The company's ROE is forecasted to remain above 20% from 2024 to 2026, with PE ratios declining from 14.67x in 2024 to 10.36x in 2026 [4] - As of September 18, 2024, the company's market capitalization stands at RMB 3.309 billion, with a 6-month average daily trading volume of RMB 28.22 million [6] Industry and Market Outlook - Composite current collectors offer advantages in energy density, safety, and cost, with PET copper foil production costs estimated at RMB 3.0/m² and PP copper foil at RMB 3.2/m², lower than traditional copper foil's RMB 4.7/m² [1][9] - The one-step equipment market space is projected to reach RMB 4.8 billion by 2030, with a CAGR of 52% from 2025 to 2030 [2][45] - By 2030, the demand for composite copper foil in new energy vehicles and energy storage is expected to reach 297GWh, driven by increasing penetration rates and cost advantages [45][46] Competitive Landscape - Hongtian Technology's dry one-step method has gained recognition from major players like Hanli New Materials and Nuode Investment, with the ability to co-produce composite copper and aluminum foils, reducing equipment investment costs [48] - While two-step methods currently dominate, the acceptance of dry one-step methods is higher than expected, with Hongtian Technology securing orders and beginning deliveries [3][48]