Bestechnic (Shanghai) (SH:688608) Tai Ping Yang·2024-10-23 03:09Investment Rating - The report maintains a "Buy" rating for the company, expecting a relative increase of over 15% compared to the CSI 300 index in the next six months [1][9]. Core Views - The company reported strong performance in H1 2024, with revenue reaching 1.531 billion yuan, a year-on-year increase of 68.26%. The net profit attributable to shareholders was 148 million yuan, up 199.76% year-on-year, and the non-GAAP net profit was 112 million yuan, a staggering increase of 1872.87% [2][3]. - The growth in performance is driven by sustained demand in the downstream markets, particularly in smart wearables and smart home sectors. The company's market share in smart watch and band chips has rapidly increased, supported by the launch of new products [2][3]. - The new generation wearable chip, BES2800, has been mass-produced and is expected to enhance the company's competitive edge in the market, providing powerful computing capabilities and seamless connectivity for wearable devices [2][3]. Summary by Sections Financial Performance - In H1 2024, the company achieved a revenue of 1.531 billion yuan, with a Q2 revenue of 878 million yuan, reflecting a year-on-year growth of 66.80% and a quarter-on-quarter growth of 34.45% [2][3]. - The company’s total expenses for sales, management, and R&D in H1 2024 amounted to 395 million yuan, accounting for 25.81% of revenue, which is a decrease of 7.36 percentage points compared to the previous year [3]. Future Projections - The company is projected to achieve revenues of 3.156 billion yuan, 4.136 billion yuan, and 5.312 billion yuan for the years 2024, 2025, and 2026, respectively. The net profit attributable to shareholders is expected to be 355 million yuan, 541 million yuan, and 777 million yuan for the same years [3][5]. - The report anticipates a significant increase in earnings per share (EPS) from 1.03 yuan in 2023 to 2.96 yuan in 2024, with a corresponding PE ratio decreasing from 149.21 to 90.51 [5][3]. Market Position - The company has successfully expanded its market share in the smart wearable sector, with smart watch and band chips contributing approximately 28% to its revenue in H1 2024, a notable increase from the previous year [2][3]. - The ongoing investment in high-level technology research and development is crucial for maintaining the company's core competitiveness, with R&D expenses rising by 36.76% year-on-year [3].