Hygon Information Technology (688041) Shanxi Securities·2024-10-17 10:03Investment Rating - The report maintains a "Buy-A" rating for the company [1] Core Views - The company reported a significant revenue growth of 55.64% year-on-year for the first three quarters of 2024, reaching 6.137 billion yuan, with a net profit increase of 69.22% to 1.526 billion yuan [2] - In Q3 2024, the company achieved a revenue of 2.374 billion yuan, marking a 78.33% year-on-year growth, and a net profit of 672 million yuan, which is a remarkable increase of 199.90% [2] - The company's gross margin improved significantly, reaching 65.63% for the first three quarters and 69.13% in Q3, driven by increased shipments of CPU and DCU products [3] - The company is expected to benefit from the domestic demand for CPUs and AI chips, particularly due to the rapid advancement of the domestic AI industry and the U.S. chip export controls [3][4] Financial Performance Summary - For the first three quarters of 2024, the company reported a gross margin of 65.63%, up 5.01 percentage points year-on-year, and a net profit margin of 34.33%, an increase of 3.48 percentage points [3] - The company has increased its inventory significantly, reaching 3.896 billion yuan by the end of September 2024, up from 1.074 billion yuan at the end of the previous year [3] - The projected earnings per share (EPS) for 2024-2026 are 0.89, 1.36, and 1.92 yuan, respectively, with corresponding price-to-earnings (P/E) ratios of 127.09, 83.26, and 59.24 [4][5] Financial Data and Valuation - The company’s revenue is projected to grow from 6.012 billion yuan in 2023 to 9.078 billion yuan in 2024, representing a year-on-year growth of 51% [5] - The net profit is expected to increase from 1.263 billion yuan in 2023 to 2.077 billion yuan in 2024, reflecting a growth of 64.4% [5] - The gross margin is anticipated to improve from 59.7% in 2023 to 65.3% in 2024 [5][7]