ToLand(SZ:300855) AVIC Securities·2024-10-29 14:56Investment Rating - The investment rating for the company is "Buy" with a target price of 29 CNY, indicating an expected return of over 10% relative to the Shanghai and Shenzhen 300 Index in the next six months [2][11]. Core Views - The company reported a revenue of 1.08 billion CNY for the first three quarters of 2024, a slight increase of 1.33% year-on-year, while the net profit attributable to shareholders was 258 million CNY, down 1.00% year-on-year. The gross margin was 35.83%, up 0.22 percentage points, and the net margin was 23.91%, down 0.56 percentage points [2][4]. - The company is experiencing short-term pressure on revenue and profits due to changes in product sales structure, with a significant increase in R&D expenses, which rose by 34.54% to 53 million CNY [2][4]. - The company has completed the construction of new production lines, which are expected to support high growth in performance in the future. The new production capacity includes 1,000 tons of ultra-pure high-performance high-temperature alloys and 3,300 complex thin-walled high-temperature alloy components annually [4][5]. Summary by Sections Financial Performance - For the first three quarters of 2024, the company reported a revenue of 1.08 billion CNY, with a net profit of 258 million CNY. The third quarter revenue was 348 million CNY, down 7.35% year-on-year and 8.74% quarter-on-quarter, marking the first negative growth since the company went public [2][4]. - The company’s R&D expenses reached 53 million CNY, accounting for 4.90% of revenue, reflecting a strategic focus on enhancing R&D capabilities [2][4]. Future Growth Potential - The company has completed several key projects that are expected to drive future growth, including the construction of production lines for aviation components and high-temperature alloys. These projects are anticipated to yield significant benefits as they ramp up production [4][5]. - The company is also exploring new business areas through strategic partnerships, particularly in ceramic matrix composites, which could provide additional growth avenues [4][5]. Revenue and Profit Forecast - The projected revenues for 2024, 2025, and 2026 are 1.48 billion CNY, 1.87 billion CNY, and 2.35 billion CNY, respectively. The net profits for the same years are expected to be 352 million CNY, 421 million CNY, and 526 million CNY, with corresponding EPS of 0.89 CNY, 1.06 CNY, and 1.33 CNY [5][6].