XUSHENG(603305) 民生证券·2024-10-30 08:43Investment Rating - The report maintains a "Recommend" rating for Xusheng Group (603305 SH) [1][3] Core Views - Xusheng Group's Q3 2024 performance was under pressure, with revenue declining 7 40% YoY to 1 125 billion yuan, and net profit attributable to shareholders dropping 65 96% YoY to 58 million yuan [1] - The company's profitability declined significantly due to rising raw material prices, convertible bond interest expenses, and impairment losses [1] - Xusheng Group is accelerating capacity expansion and advancing overseas production layout, with a 2 8 billion yuan convertible bond issuance in June 2024 to fund lightweight automotive components and new energy vehicle powertrain projects [1] - The company's customer diversification strategy is progressing well, with the revenue contribution from the top five customers decreasing from 66 2% in 2021 to 56 2% in 2023 [1] Financial Performance - For the first three quarters of 2024, Xusheng Group reported revenue of 3 274 billion yuan, down 8 42% YoY, and net profit attributable to shareholders of 323 million yuan, down 42 83% YoY [1] - In Q3 2024, the company's gross margin was 18 22%, down 7 08 percentage points YoY, and net profit margin was 4 97%, down 9 04 percentage points YoY [1] - The report forecasts Xusheng Group's revenue to reach 4 57 billion yuan in 2024, 6 06 billion yuan in 2025, and 7 5 billion yuan in 2026, with corresponding net profits of 440 million yuan, 620 million yuan, and 810 million yuan [1][2] Customer and Market - Xusheng Group's major clients include Tesla, Great Wall Motors, and ZF, with Tesla's Q3 2024 sales increasing 6 0% YoY to 463,000 units [1] - The company is leveraging its cost, technology, and proximity advantages to serve North American and European markets through its Mexico factory, which is currently under construction [1] Valuation - Based on the closing price of 13 00 yuan on October 29, 2024, Xusheng Group's PE ratios are projected to be 27x for 2024, 19x for 2025, and 15x for 2026 [1][2] - The company's PB ratios are forecasted to be 1 8x for 2024, 1 7x for 2025, and 1 5x for 2026 [2]