AVICHM(600765) ZHONGTAI SECURITIES·2024-11-01 10:36Investment Rating - The investment rating for the company is "Buy" (maintained) [1][6] Core Views - The company has shown strong growth in commercial and civil engineering, with the Hongshan model expected to turn profitable [1][3] - The company reported a decrease in revenue for the first three quarters of 2024, but a positive net profit growth when excluding the impact of Hongshan [2][4] - The company is focusing on optimizing its main product capacity and enhancing its integrated cost reduction capabilities [3][4] Financial Performance Summary - For the first three quarters of 2024, the company achieved revenue of 7.524 billion yuan, a year-on-year decrease of 5.56%, and a net profit of 1.013 billion yuan, a year-on-year decrease of 1.42% [1] - In Q3 2024, the company reported revenue of 2.052 billion yuan, a year-on-year decrease of 16.69%, while net profit increased by 15.97% to 290 million yuan [2] - The company completed 63% of its annual revenue target and 66% of its net profit target for the year by the end of Q3 2024 [2] Profitability and Cost Management - The gross profit margin for the first three quarters of 2024 was 31.48%, a decrease of 1.91 percentage points year-on-year, while the net profit margin improved by 0.55 percentage points to 14.17% [2] - The company has seen a continuous decline in expense ratios, with inventory increasing by 23% since the beginning of the year [2] - The company is focusing on high-value-added materials and large forging capacity to improve its product structure and profitability [4] Market and Order Developments - The company has entered a rapid development phase in commercial and civil engineering, with civil aviation and civil product revenues increasing by 89% and 35% respectively [3] - The company has secured long-term orders with major clients, including a total of approximately 70 million yuan in new orders from Hongshan and Boeing [3] - The company is enhancing its overall component delivery capabilities through the establishment of a new company focused on precision processing [4] Future Earnings Forecast - The company is expected to achieve revenues of 11.956 billion yuan, 13.798 billion yuan, and 15.649 billion yuan for the years 2024, 2025, and 2026 respectively, with corresponding net profits of 1.541 billion yuan, 1.779 billion yuan, and 2.095 billion yuan [4][5]