Linyang Energy(601222) 华创证券·2024-11-07 07:31Investment Rating - The report maintains a "Recommend" rating for Lin Yang Energy (601222) with a target price of 9.27 RMB, compared to the current price of 7.75 RMB [1] Core Views - Lin Yang Energy's Q1-Q3 2024 performance met expectations, with revenue of 5.166 billion RMB (+8.76% YoY) and net profit of 910 million RMB (+6.95% YoY) [1] - The company's gross margin improved to 32.48% (+0.58pct YoY), while net margin slightly decreased to 17.62% (-0.30pct YoY) [1] - Q3 2024 showed strong growth with revenue of 1.703 billion RMB (+10.63% YoY) and net profit of 312 million RMB (+15.41% YoY) [1] Business Segments Smart Meter Business - The smart meter segment is growing steadily, with active participation in domestic power grid tenders and expansion into over 30 international markets [2] - Strategic partnerships with global leaders like Landis+Gyr and ECC are helping to expand market share in Western Europe, Asia-Pacific, and the Middle East [2] Renewable Energy - The company's self-owned power plants reached 1.34GW by Q3 2024, including 1.16GW of solar and 187MW of wind projects [2] - With a 94% utilization rate, these projects are well-positioned in economically developed regions of Eastern China [2] Energy Storage - Lin Yang Energy is aggressively expanding its overseas energy storage business, focusing on Europe, the Middle East, and Southeast Asia [2] - The company is establishing a joint venture with Saudi ECC for a battery pack factory in Jeddah, expected to start production in Q4 2024 [2] Financial Performance - Operating cash flow significantly improved to 625 million RMB in Q1-Q3 2024, compared to -411 million RMB in the same period last year [2] - The company's PE ratio is projected at 14x for 2024, 12x for 2025, and 10x for 2026 [2] - Revenue is expected to grow from 7.988 billion RMB in 2024 to 13.103 billion RMB in 2026, with net profit increasing from 1.128 billion RMB to 1.597 billion RMB over the same period [3] Market Position - Lin Yang Energy has a total market capitalization of 15.966 billion RMB, with a P/B ratio of 1.0 and a debt-to-asset ratio of 35.21% [4] - The company's 12-month stock price range is between 5.13 RMB and 7.88 RMB [4]