GTC(000589) Guohai Securities·2024-11-02 14:39Investment Rating - The report maintains a "Buy" rating for Guizhou Tire [2][5][20] Core Views - Guizhou Tire's revenue for the first three quarters of 2024 increased by 11.45% year-on-year, reaching 7.843 billion yuan, while net profit attributable to shareholders decreased by 10.76% to 560 million yuan [2][3] - The company is progressing well with its Vietnam Phase III project, which is expected to contribute significantly to future revenue [5][17] - The report adjusts the profit forecast for the company, estimating revenues of 10.574 billion, 13.227 billion, and 14.105 billion yuan for 2024, 2025, and 2026 respectively, with corresponding net profits of 697 million, 924 million, and 1.132 billion yuan [5][17] Summary by Sections Market Data - The 52-week price range for Guizhou Tire is between 4.17 and 6.98 yuan [1] Financial Performance - In Q3 2024, the company reported a revenue of 2.668 billion yuan, a year-on-year increase of 2.80%, but a net profit decline of 53.63% year-on-year to 134 million yuan [2][3] - The gross profit margin for Q3 2024 was 16.52%, down 7.24 percentage points year-on-year [3][8] - Operating cash flow for the first three quarters was 436 million yuan, a decrease of 58.34% year-on-year [3][9] Cost and Expenses - The report highlights an increase in raw material prices, which has negatively impacted profit margins [3][5] - The selling expense ratio for the first three quarters was 4.11%, an increase of 0.46 percentage points year-on-year [3][8] Future Outlook - The Vietnam Phase III project is expected to generate an average annual sales revenue of approximately 189.99 million USD and an average annual profit of 28.62 million USD once operational [5][17] - The report anticipates a recovery in profitability in the coming years, with a projected PE ratio of 10.82, 8.16, and 6.66 for 2024, 2025, and 2026 respectively [5][17]