Henan Thinker Automatic Equipment (SH:603508) Southwest Securities·2024-10-29 10:31Investment Rating - The report maintains a "Buy" rating for the company, indicating a positive outlook for the next six months [1]. Core Views - The company reported a significant revenue growth of 23.8% year-on-year for the first three quarters of 2024, reaching 910 million yuan, with a net profit increase of 34.0% to 330 million yuan. In Q3 alone, revenue surged by 69.2% year-on-year to 350 million yuan, and net profit rose by 94.2% to 140 million yuan, exceeding expectations [1]. - The company's gross margin improved to 63.6% for the first three quarters, up by 4.1 percentage points year-on-year, driven by a higher proportion of high-margin businesses and effective cost management [1]. - The company announced a profit distribution plan, proposing a dividend of 2.5 yuan per 10 shares, reflecting a commitment to shareholder returns and confidence in long-term growth [1]. - The railway equipment industry is experiencing high demand and sustainability, with the company poised to benefit from ongoing equipment upgrades and increased investment in railway infrastructure [1]. Summary by Sections Financial Performance - For Q1-Q3 2024, the company achieved a revenue of 910 million yuan, a 23.8% increase year-on-year, and a net profit of 330 million yuan, up 34.0% [1]. - In Q3 2024, revenue reached 350 million yuan, marking a 69.2% year-on-year growth, while net profit was 140 million yuan, a 94.2% increase [1]. - The gross margin for Q1-Q3 2024 was 63.6%, an increase of 4.1 percentage points year-on-year, with a net profit margin of 37.4%, up 2.7 percentage points [1]. Business Outlook - The company is benefiting from a favorable environment in the railway equipment sector, with a consistent increase in orders and project approvals [1]. - The report highlights that the company’s products are in a replacement cycle, aligning with national policies promoting large-scale equipment upgrades [1]. - The expected average annual railway investment for 2024-2025 is projected to exceed 800 billion yuan, supporting ongoing demand for the company's products [1]. Profit Forecast - The company’s net profit is forecasted to reach 550 million yuan in 2024, 670 million yuan in 2025, and 760 million yuan in 2026, with a compound annual growth rate of 23% over the next three years [1].