NNCC(600435) 国泰君安·2024-10-28 11:46Investment Rating - The report assigns a "Buy" rating to the stock with a target price of 18.90 CNY [5] Core Views - The company achieved a turnaround in Q3 2024 with a significant quarter-on-quarter revenue increase, despite earlier performance pressure due to contract signing delays [3] - As a leading player in weapon guidance and control, the company has a stable industry position and highly certain demand, with expectations of a performance recovery [3] - The company's Q3 2024 revenue was 503 million CNY (-25.6% YoY, +134.72% QoQ), with a net profit of 4.659 million CNY, marking a return to profitability [10] - The company's gross margin improved slightly to 31.24% (+5.34 pct) in the first three quarters of 2024, with R&D expenses increasing to 165 million CNY (+7.1%) [10] Financial Performance - The company's total revenue for the first three quarters of 2024 was 796 million CNY (-66.80% YoY), with a net loss of 74 million CNY (-139.88% YoY) [10] - The company's total market capitalization is 17,249 million CNY, with a current price of 11.48 CNY and a target price of 18.90 CNY [5][6] - The company's shareholder equity is 2,607 million CNY, with a net asset value per share of 1.73 CNY and a price-to-book ratio of 6.6 [7] Industry and Market Position - The company is a core enterprise under the China Ordnance Group, focusing on "navigation control and ammunition informatization technology," and is a key supplier of inertial guidance control cabins for precision-guided munitions [10] - The demand for precision-guided weapons is highly certain, with rocket artillery being cost-effective and widely used in modern conflicts, driving long-term industry demand [10] - The company is actively adjusting to the incremental changes in the "14th Five-Year Plan" and customer order demands, with expectations of rapid growth as downstream demand materializes [10] Financial Forecasts - The company's revenue is expected to grow from 3,743 million CNY in 2024E to 6,692 million CNY in 2026E, with net profit increasing from 202 million CNY to 410 million CNY over the same period [11] - The company's EPS is forecasted to rise from 0.13 CNY in 2024E to 0.27 CNY in 2026E, with ROE improving from 7.0% to 12.1% [11] - The company's R&D expenses are projected to increase from 251 million CNY in 2024E to 455 million CNY in 2026E, reflecting continued investment in innovation [12]