CFMOTO(SH:603129) SINOLINK SECURITIES·2024-10-18 02:00Investment Rating - The report maintains a "Buy" rating for the company, indicating an expected price increase of over 15% in the next 6-12 months [5][9]. Core Views - The company's performance has exceeded expectations, driven by increased sales scale and a significant reduction in sales and management expense ratios [4]. - The company is expected to benefit from the strong potential of several new vehicle models, which are anticipated to drive sales growth in 2024 and 2025 [5]. Summary by Relevant Sections Financial Performance - In Q3 2024, the company achieved revenue of 39.21 billion RMB, a year-on-year increase of 36.11%, and a net profit of 3.73 billion RMB, up 48.95% year-on-year [4]. - For the first three quarters of 2024, revenue reached 114.5 billion RMB, growing by 21.98%, with a net profit of 10.81 billion RMB, reflecting a 34.87% increase [4]. - The gross profit margin for Q3 2024 was 31.57%, slightly down from the previous year, while the net profit margin improved to 9.74% [4]. Revenue and Profit Forecast - Revenue projections for 2024, 2025, and 2026 are 153.36 billion RMB, 187.60 billion RMB, and 217.38 billion RMB, respectively [5]. - The forecasted net profits for the same years are 13.51 billion RMB, 17.48 billion RMB, and 21.39 billion RMB, respectively [5]. - The company’s diluted earnings per share are expected to rise from 8.919 RMB in 2024 to 14.127 RMB in 2026 [3]. Key Financial Ratios - The company’s return on equity (ROE) is projected to increase from 20.00% in 2023 to 22.93% in 2026 [3]. - The price-to-earnings (P/E) ratio is expected to decrease from 15.27 in 2023 to 10.59 in 2026, indicating potential undervaluation [3]. Market Position and Growth Drivers - The company has seen significant growth in both domestic and international sales, with two-wheeler sales increasing by 74% and 115% in July and August 2024, respectively [4]. - New models such as 675SR, Z10, and U10PRO are expected to contribute significantly to sales growth towards the end of 2024 and into 2025 [4].