SCC(SZ:002916) Guoyuan Securities·2024-10-29 08:00Investment Rating - The investment rating for the company is "Buy" and is maintained [2]. Core Views - The company achieved a revenue of 13.05 billion yuan in the first three quarters, representing a year-on-year increase of 37.9%. The net profit attributable to shareholders reached 1.49 billion yuan, up 63.9% year-on-year, with a non-recurring net profit of 1.38 billion yuan, increasing by 86.7% year-on-year. In Q3 2024, the company reported a revenue of 4.73 billion yuan, a 38.0% year-on-year increase, and a net profit of 501 million yuan, up 15.3% year-on-year [2][3]. - The demand for AI and automotive electronics is driving improvements in the PCB business, with Q3 operating rates remaining high. In the communications sector, the demand for high-speed switches and optical modules is increasing due to AI needs, benefiting from the rise in single-machine value and high-speed PCB demand. The data center sector is seeing a recovery in server demand, supported by the growth of AI accelerator cards and ESG platform products. In the automotive sector, the focus is on new energy and ADAS, with steady growth in product demand as customer projects are released [2][3]. Financial Performance - The gross profit margin for Q1-Q3 2024 was 25.9%, an increase of 2.79 percentage points year-on-year, while the Q3 gross profit margin was 25.4%, up 1.96 percentage points year-on-year but down 1.72 percentage points quarter-on-quarter [2]. - The company's BT products are aligning with the recovery trend in the storage market, leading to an increase in orders for storage-related products. The processor chip products have achieved breakthroughs in large-size manufacturing capabilities, supporting the introduction of new customers and products. The ABF substrate business is expected to have significant growth potential, with the company achieving mass production capabilities for 16-layer and below FC-BGA packaging substrates [3]. Investment Recommendations and Profit Forecast - The target price for the company is set at 104.99 yuan with a target period of 6 months. The current price is expected to outperform the benchmark index by more than 15% [2][3]. - Revenue forecasts for 2024 and 2025 are 18.64 billion yuan and 21.73 billion yuan, respectively, with growth rates of 38% and 17% [6]. The net profit attributable to shareholders is projected to be 2.14 billion yuan in 2024 and 2.44 billion yuan in 2025, with growth rates of 53% and 14% [6].