LY iTECH(SZ:002600) Orient Securities·2024-11-01 00:44Investment Rating - The report maintains a "Buy" rating for the company with a target price of 12.42 CNY based on a projected PE ratio of 27 times for 2025 [2][5]. Core Insights - The company achieved record-high quarterly revenue of 124 billion CNY in Q3, marking a 32% year-over-year increase and a 33% quarter-over-quarter increase, while the net profit for the same quarter grew by 15% to 7.1 billion CNY [1][5]. - The company is strategically positioned in the consumer electronics cooling components sector, benefiting from the trend of increased heat dissipation in AI-enabled devices [1]. - The long-term growth potential in the consumer electronics sector is significant, with the company being a key supplier for major North American clients, which are expected to drive innovation in hardware functionalities [1]. Financial Performance Summary - The company reported a total revenue of 315 billion CNY for the first three quarters, a 28% increase year-over-year, while the net profit attributable to the parent company was 14.1 billion CNY, down 25% year-over-year [1]. - The forecast for earnings per share (EPS) for 2024-2026 is set at 0.30, 0.46, and 0.56 CNY respectively, with slight adjustments made to revenue and gross margin predictions [2][7]. - The gross margin for Q3 improved to 17.2%, reflecting a 2.2 percentage point increase from the previous quarter, driven by the introduction of new products [1][2]. Financial Metrics - The company's revenue for 2023 is projected at 34,124 million CNY, with a slight decline of 1% from the previous year, followed by a forecasted growth of 21% in 2024 [4]. - The net profit for 2023 is expected to be 2,051 million CNY, representing a 28.5% increase from 2022, with further growth anticipated in subsequent years [4]. - The company’s return on equity (ROE) is projected to increase from 11.6% in 2023 to 15.3% by 2026, indicating improving profitability [4].