ZHEJIANG DINGLI(SH:603338) Zhao Yin Guo Ji·2024-10-30 03:01Investment Rating - Maintain BUY with an unchanged target price of RMB75, representing an upside of 54.6% from the current price of RMB48.50 [3]. Core Insights - Zhejiang Dingli's EBIT in 3Q24 grew 20% YoY to RMB672 million, driven by a 38% revenue growth YoY, despite a 4.8 percentage point decrease in gross margin due to a high base in 3Q23 [1]. - The company reported a net profit growth of 38% YoY to RMB636 million, supported by an increase in net finance income [1]. - Management emphasized a focus on the US market, which is expected to remain the most promising in 2025E [1]. - The US sales target for 2024E is maintained at US$500 million (~RMB3.5 billion), indicating potential sales of ~RMB600 million in 4Q24E [1]. - Dingli aims to deliver a total of 6,000 units of boom lifts overseas, with 2,000 units targeted for the US [1]. Financial Summary - Revenue is projected to grow from RMB6,312 million in FY23A to RMB7,569 million in FY24E, reflecting a YoY growth of 19.9% [2]. - Net profit is expected to increase from RMB1,867.2 million in FY23A to RMB2,104.9 million in FY24E, a growth of 12.7% [2]. - The P/E ratio is forecasted to decrease from 13.2x in FY23A to 11.7x in FY24E, indicating a more attractive valuation [2]. Product and Market Strategy - Dingli plans to differentiate its products to mitigate the impact of anti-dumping duties in the EU, aiming for stable sales in Europe [1]. - The company expects overseas revenue from boom lifts to exceed that from scissors lifts for the full year [1]. - The anticipated reduction in anti-dumping duties in the US is expected to alleviate some market pressures [1].