NBJF(SH:603997) Huachuang Securities·2024-09-24 23:06Investment Rating - The report maintains a "Strong Buy" rating for the company, with a target price of 13.3 yuan [1]. Core Views - The sale of TMD LLC by the subsidiary Gramer is expected to improve profitability and financial conditions for Gramer in North America, which has been a significant source of losses [1]. - The company anticipates that the sale will allow for a focus on core business and enhance overall competitiveness [1]. - The rapid growth of the integrated seat business is projected to contribute significantly to profits by 2025, with expected revenues of 55-60 billion yuan and net profits of 2-3 billion yuan [1]. Financial Summary - Total revenue is projected to grow from 21,571 million yuan in 2023 to 30,082 million yuan in 2026, with a compound annual growth rate (CAGR) of approximately 16.2% [2]. - The net profit attributable to the parent company is expected to decline sharply to 14 million yuan in 2024, followed by a significant rebound to 894 million yuan in 2025 [2]. - Earnings per share (EPS) is forecasted to increase from 0.01 yuan in 2024 to 0.71 yuan in 2025 [2]. - The company’s price-to-earnings (P/E) ratio is projected to drop from 1,045 in 2024 to 17 in 2025, indicating a potential recovery in profitability [2]. Business Developments - The report highlights that the TMD subsidiary has been a major contributor to losses in Gramer's North American operations, with a net loss of 260 million yuan in 2023 [1]. - The integrated seat business has shown promising growth, with a revenue increase of 7.3 times year-on-year in the first half of 2024, indicating strong market demand [1]. - The company has secured 19 high-quality projects for passenger car seats, which are expected to drive future revenue growth [1].