SCC(SZ:002916) Changjiang Securities·2024-10-31 10:24Investment Rating - The investment rating for the company is "Buy" and is maintained [2][5]. Core Views - The company reported a revenue of 13.049 billion yuan for the first three quarters of 2024, representing a year-on-year increase of 37.92%. The net profit attributable to shareholders reached 1.488 billion yuan, up 63.86% year-on-year [3]. - In the third quarter alone, the company achieved a revenue of 4.728 billion yuan, reflecting a year-on-year increase of 37.95% and a quarter-on-quarter increase of 8.45%. The net profit for the same period was 501 million yuan, which is a year-on-year increase of 15.33% but a quarter-on-quarter decrease of 17.60% [3]. - The gross margin for the first three quarters was 25.91%, an increase of 2.80 percentage points year-on-year, while the net margin was 11.40%, up 1.80 percentage points year-on-year [3]. - The company has significantly increased its R&D investment, with R&D expenses reaching 924 million yuan in the first three quarters, a year-on-year increase of 45.45% [3][4]. Summary by Sections Financial Performance - For the first three quarters of 2024, the company achieved a gross margin of 25.91% and a net margin of 11.40% [3]. - The company experienced a foreign exchange loss of approximately 63 million yuan in the third quarter, which negatively impacted profitability [3]. - The company expects net profits of 1.923 billion yuan, 2.474 billion yuan, and 2.962 billion yuan for 2024, 2025, and 2026 respectively, with corresponding PE ratios of 28.32, 22.01, and 18.39 [5]. Market Demand and Growth Drivers - The demand for AI-related products has positively impacted the company's growth, particularly in the communication sector with increased orders for high-speed switches and optical modules [4]. - The company has seen significant growth in its data center orders, driven by the demand for AI accelerator cards and the Eagle Stream platform products [4]. - The company has made progress in the packaging substrate sector, with the FC-BGA packaging substrate achieving mass production capabilities for products with 16 layers and below [4]. R&D and Product Development - The company has focused on R&D investments, with a notable increase in expenses aimed at enhancing its packaging substrate business [3][5]. - The company is actively collaborating with downstream clients for the development and prototyping of next-generation platform products [4].