Linglong Tyre(601966)2024-10-31 03:43Investment Rating - The report maintains an "Outperform" rating for Linglong Tire, indicating a positive outlook for the company's stock performance relative to the market [5][8]. Core Insights - The company reported a revenue of 15.95 billion yuan for the first three quarters of 2024, representing a year-over-year increase of 9.8%. The net profit attributable to the parent company reached 1.71 billion yuan, up 78.4% year-over-year, while the non-recurring net profit was 1.40 billion yuan, reflecting a 56.7% increase year-over-year [5][9]. - In Q3 2024, the company achieved a revenue of 5.56 billion yuan, a 5.2% increase year-over-year and a 4.4% increase quarter-over-quarter. The net profit attributable to the parent company for Q3 was 786 million yuan, marking a 97.3% year-over-year increase and a 62.4% quarter-over-quarter increase [5][7]. Summary by Sections Market Data - Closing price: 19.72 yuan - Market capitalization: 28.86 billion yuan - Price-to-book ratio: 1.3 - Dividend yield: 2.42% [1][2]. Financial Performance - Tire production and sales increased steadily, with total tire production reaching approximately 65.72 million units (up 15% year-over-year) and sales at 61.34 million units (up 10.8% year-over-year) for the first three quarters [6]. - The gross margin improved by 4.65 percentage points to 24.35% due to increased capacity utilization and strong demand for semi-steel tires [6][9]. Production and Capacity Expansion - The Serbian factory has begun to turn a profit, contributing to future growth. The company plans to invest approximately 4.6 billion yuan to expand production capacity [8]. - The company is actively upgrading its product offerings and adjusting its market structure in both domestic and international markets [6][8]. Profit Forecast and Valuation - The report maintains profit forecasts for 2024-2026, estimating net profits of approximately 2.13 billion, 2.51 billion, and 2.82 billion yuan, respectively, with corresponding price-to-earnings ratios of about 14, 11, and 10 [8][9].