TORCH ELECTRON(SH:603678) Minsheng Securities·2024-10-29 05:30Investment Rating - The report maintains a "Recommended" rating for the company, considering its industry position and growth potential in new business areas [1][3]. Core Insights - The company reported a 61% year-on-year increase in net profit for Q3 2024, despite a 20.7% decline in revenue year-to-date [1]. - The overall market demand has slowed, leading to a decrease in revenue and profit, but the decline rate has significantly narrowed [1]. - The company has fully acquired Fujian Millimeter, enhancing its core competitiveness in self-produced components [1]. Financial Performance Summary - For the first three quarters of 2024, the company achieved revenue of 2.151 billion yuan, down 20.7% year-on-year, and a net profit of 226 million yuan, down 22.6% year-on-year [1]. - In Q3 2024, the company recorded revenue of 725 million yuan, a decrease of 36.2% year-on-year, but net profit increased by 60.8% to 62 million yuan [1]. - The gross margin for the first three quarters of 2024 improved by 0.9 percentage points to 32.4%, while the net margin decreased by 0.7 percentage points to 9.9% [1]. Future Earnings Forecast - The company expects net profits for 2024, 2025, and 2026 to be 318 million yuan, 454 million yuan, and 603 million yuan respectively, with corresponding PE ratios of 41x, 29x, and 22x [1][4].