TFC(300394)2024-10-24 08:08Investment Rating - The report maintains a "Buy-A" investment rating with a target price of 137.63 CNY for the next six months [6][7]. Core Views - The company has experienced significant growth in revenue and net profit due to the increasing demand for high-speed optical devices, with a revenue of 2.395 billion CNY for the first three quarters of 2024, representing a year-on-year increase of 98.55%, and a net profit of 976 million CNY, up 122.39% [3][4]. - The demand for optical devices in the telecommunications sector remains stable, while the data center market is benefiting from the global development of AI technology and increased computing power needs [4][5]. - The company is expanding its global presence with the establishment of a headquarters in Singapore and a production base in Thailand, which is already partially operational [4]. Financial Performance - The company’s gross margin for the first three quarters of 2024 is 58.21%, compared to 52.94% in the same period last year [4]. - Revenue projections for 2024 to 2026 are estimated at 3.792 billion CNY, 5.802 billion CNY, and 7.542 billion CNY, respectively, with net profits expected to be 1.412 billion CNY, 2.184 billion CNY, and 2.832 billion CNY [6][9]. - The company’s earnings per share (EPS) is projected to grow from 1.32 CNY in 2023 to 5.11 CNY by 2026 [9]. Market Outlook - The optical module market is expected to grow at a rate exceeding 40% in 2024, with the data communication optical module segment anticipated to grow the fastest [5]. - By the end of 2023, the total number of operational data center racks in China exceeded 8.1 million, with a growth rate of over 20% [5].