BIYI(603215)2024-11-11 04:51Investment Rating - The report maintains a "Recommend" rating for Biyi Co Ltd (603215) with a target price of 19 yuan [1] Core Views - Biyi Co Ltd achieved a significant revenue growth of 51 6% YoY in Q3 2024 reaching 620 million yuan driven by strong air fryer OEM orders [1][2] - Despite revenue growth the company's net profit declined by 30 6% YoY to 30 million yuan in Q3 2024 due to a drop in gross margin to 15 3% [1][2] - The company is expanding its product portfolio with new offerings like coffee machines which are expected to become a new growth driver [2] - Biyi Co Ltd has a stable partnership with major clients such as Philips and Newell with over a decade of collaboration with Newell [2] Financial Performance - Revenue for 2024E is projected at 1 854 million yuan with a YoY growth of 18 9% while net profit is expected to decline by 34 1% to 133 million yuan [3] - The company's gross margin is forecasted to recover from 16 3% in 2024E to 19 6% in 2026E as new products scale up [6] - EPS for 2024E is estimated at 0 71 yuan with a P/E ratio of 23x [3] Market Position and Growth Potential - Biyi Co Ltd is a leading OEM for air fryers with stable demand from overseas markets where penetration remains low indicating significant growth potential [2] - The company is leveraging its cost advantages in OEM manufacturing to expand its client base and sustain growth momentum [2] Valuation and Forecast - The target price of 19 yuan is based on a DCF valuation with a 2025E P/E of 17 3x [2] - Revenue is expected to grow to 2 430 million yuan by 2026E with a CAGR of 13 4% from 2024E to 2026E [3] - Net profit is projected to rebound to 242 million yuan by 2026E with a CAGR of 16 8% from 2025E to 2026E [3]