AUPU(SH:603551) Soochow Securities·2024-10-07 23:30Investment Rating - The report assigns an "Accumulate" rating for the company, marking its first coverage [2]. Core Insights - Aopu Technology has evolved into a well-known brand in the bathroom heater and integrated ceiling industry since launching its first bathroom heater in 1993. The company follows a dual development path of "appliances + home" and focuses on product innovation and channel upgrades, leading to steady business growth. In 2023, the company achieved revenue of 1.996 billion yuan, a year-on-year increase of 6.17% [2]. - The bathroom heater products are moving towards high value-added and multifunctional development, with significant growth potential in industry penetration. As a leader in the bathroom heater industry, Aopu is expected to benefit from the enhancement of product value. The integrated ceiling industry remains fragmented, with Aopu's core appliance business supported by auxiliary material business, creating comprehensive solutions for various home spaces [2]. - The company emphasizes research and development, continuously enhancing product competitiveness. Aopu has launched several innovative products, including kitchen air conditioners and new series of bathroom heaters, maintaining industry-leading product capabilities. The company has also expanded its sales network, with a total of 1,051 agents and 1,469 specialty stores by the end of 2023, while e-commerce channels have grown significantly [2]. - The company forecasts net profits of 329.33 million yuan, 371.53 million yuan, and 416.93 million yuan for 2024, 2025, and 2026, respectively, with corresponding P/E ratios of 11X, 10X, and 9X [2]. Summary by Sections Aopu Home: Industry Leader - Aopu Home is a comprehensive service provider focusing on the research, production, sales, and service of home appliances and integrated ceiling products. The company has a strong foundation in bathroom heater technology and has expanded its product range to include various home appliances [15]. Bathroom Heater Industry - The bathroom heater industry has evolved through three stages: initial introduction, product diversification, and the current trend towards smart and integrated solutions. Aopu leads the market with innovative products that meet changing consumer demands [25][26]. Integrated Ceiling Industry - The integrated ceiling industry is characterized by low concentration and intense competition, with many small players. Aopu's strong appliance background positions it well to leverage its integrated ceiling products to enhance overall sales [27][32]. Core Appliance Business - Aopu's core appliance business has seen an increase in revenue share, with 75.79% of total revenue coming from appliances in 2023. The company has focused on upgrading its product structure, leading to improved gross margins [19]. Financial Forecast and Investment Advice - The company is expected to continue its growth trajectory, with projected revenue increases in its appliance segment. The materials business is anticipated to remain stable, while the appliance segment is expected to grow significantly [47][49].