EVE(300014) 华兴证券·2024-10-30 07:49Investment Rating - The report maintains a "Buy" rating for Eve Energy (300014 CH) with a target price of RMB64.30, representing a 30% upside from the current price of RMB49.44 [1][2] - The target price has been revised upward by 16% from RMB55.30 to RMB64.30 [2] Core Views - Eve Energy's 3Q24 gross margin improved significantly to 19.0%, driven by higher capacity utilization in power and energy storage batteries, as well as lower raw material costs [4] - The company's overseas energy storage business is expected to grow significantly in 2025/26, with the first global cooperative project (ACT) progressing smoothly [5] - The report forecasts a 40.2% YoY growth in net profit attributable to shareholders in 2025, supported by improving capacity utilization and strong demand for energy storage and consumer batteries [6] Financial Performance - 3Q24 revenue was RMB12.39 billion, down 1.3% YoY but up 0.4% QoQ [4] - 3Q24 gross profit reached RMB2.355 billion, with a gross margin of 19.0%, up 3.4 percentage points QoQ [4] - Non-GAAP net profit attributable to shareholders grew 25.5% QoQ to RMB1.0 billion in 3Q24 [4] - The company's energy storage battery shipments reached 35.7GWh in the first three quarters of 2024, up 115.6% YoY [5] Business Outlook - Power battery shipments are expected to increase in 4Q24 with new customer Leapmotor's volume contribution [5] - The ACT project, a joint venture with Cummins, Daimler Truck, and PACCAR, is on track to start production in 2026 with an annual capacity of 21GWh [5] - Consumer batteries have been operating at full capacity for six consecutive months, with the Malaysia factory progressing well [5] Valuation - The battery business is valued at 19x 2025E P/E, implying a valuation of RMB112.4 billion [11][12] - Including the stake in Smoore International, the total valuation is RMB131.6 billion, leading to the target price of RMB64.30 [11][12] - The 2025E EPS is forecasted at RMB3.19, representing a 40.2% YoY growth [6][12] Peer Comparison - Eve Energy's 2025E P/E of 15.5x is slightly below the peer average of 19x, with a PEG ratio of 0.39 [13] - The company's valuation multiples are comparable to industry leaders like CATL (22x 2024E P/E) and Gotion High-Tech (28x 2024E P/E) [13]