HIKVISION(SZ:002415) Guoxin Securities·2024-10-30 01:30Investment Rating - The investment rating for Hikvision (002415.SZ) is "Outperform the Market" [1][3][9]. Core Views - The report highlights a positive mid-term policy outlook and long-term growth potential driven by digital transformation. Despite a short-term slowdown in business growth, the company achieved a revenue of 649.91 billion yuan in the first three quarters of 2024, representing a year-on-year increase of 6.1%. However, the net profit attributable to the parent company decreased by 3.67% year-on-year [1][3]. Summary by Sections Financial Performance - In Q3 2024, the company reported a revenue of 237.82 billion yuan, a year-on-year increase of 0.33% and a quarter-on-quarter increase of 1.67%. The net profit attributable to the parent company was 30.44 billion yuan, down 13.37% year-on-year and 3.32% quarter-on-quarter. The gross margin was 44.51%, slightly down from the previous year [1][2][3]. Business Segments - The EBG (Enterprise Business Group) and PBG (Public Business Group) showed positive revenue growth in Q3, while the SMBG (Small and Medium Business Group) faced short-term pressure. The EBG's digitalization demand remains resilient, and the PBG benefited from government support in areas like water management and emergency response. The SMBG experienced negative growth due to weak social demand and tight funding [1][3]. International and Innovative Business - The overseas and innovative business segments continued to grow, although at a slower pace compared to the first half of the year. All four overseas business centers reported positive growth, particularly in the Middle East and Southeast Asia. The innovative business, including sectors like automotive electronics and fire safety, saw rapid growth despite domestic demand challenges [1][3]. Long-term Growth Drivers - The report emphasizes the increasing demand for cost reduction and efficiency improvement, which is expected to drive long-term growth through digitalization across various industries. The collaboration with State Grid on coal quality detection technology marks a significant advancement in AI applications in the coal management sector [1][3]. Financial Forecasts - The company is expected to achieve net profits of 141 billion yuan, 160 billion yuan, and 180 billion yuan for the years 2024, 2025, and 2026, respectively. The corresponding price-to-earnings ratios are projected to be 18, 16, and 14 times [1][2][3].