FII(601138) ZHONGTAI SECURITIES·2024-11-01 01:44Investment Rating - The report maintains a "Buy" rating for the company [1] Core Views - The company achieved record-high revenue in Q3 2024, driven by strong demand for AI servers and a recovery in general server shipments [2] - The financial performance was impacted by foreign exchange losses due to the depreciation of the US dollar, which increased financial expenses [2] - The company is expected to see significant profit growth in the coming years, with projected net profits of 25 billion, 30 billion, and 33 billion yuan for 2024, 2025, and 2026 respectively [3] Revenue and Profit Forecast - Revenue for 2024 is projected to be 561.6 billion yuan, with a year-on-year growth rate of 18% [1] - The net profit for 2024 is estimated at 25 billion yuan, reflecting a year-on-year growth of 19% [1] - Earnings per share (EPS) is expected to increase to 1.26 yuan in 2024, up from 1.06 yuan in 2023 [1] Business Segments Performance - The cloud computing business saw a year-on-year revenue increase of 71%, with AI server revenue growing by 228% [2] - The network communication business, focusing on 400/800G switches, reported a revenue increase of 60% in Q1-Q3 2024, with 400/800G switch revenue up by 128% year-on-year in Q3 [3] Valuation Metrics - The company’s P/E ratio is projected to decrease from 22.9 in 2023 to 19.3 in 2024, indicating a more attractive valuation [1] - The P/B ratio is expected to decline from 3.4 in 2023 to 3.0 in 2024 [1]