KEBODA(SH:603786) Tianfeng Securities·2025-03-10 07:08Investment Rating - The report assigns a "Hold" rating for the company with a target price of 66 CNY, based on a PE of 25X for 2025 [5][44]. Core Insights - The company has a rich product matrix and is deeply integrated into the Volkswagen supply chain, which contributes significantly to its revenue. The company aims to enhance its average selling price (ASP) per vehicle by expanding its product offerings [3][37]. - The automotive electronics market presents substantial growth potential, particularly in LED lighting and domain controllers, which are becoming increasingly important in the context of smart driving and vehicle electrification [28][34]. - The company is focusing on high-value products such as domain controllers and has established a strong foothold with major global clients, including Toyota and Stellantis, which will support future revenue growth [2][43]. Summary by Sections Company Overview - Founded in 2003, the company initially focused on automotive lighting control systems and has since expanded its product line to include various electronic control systems [12][38]. - The company has established a strong relationship with Volkswagen, contributing nearly 70% of its revenue from major clients like Volkswagen Group and Audi [1][3]. Market Potential - The automotive market in China is recovering, with significant growth in both traditional and electric vehicle sales, which is expected to drive demand for LED lighting systems [28][30]. - The integration of smart driving technologies with lighting systems is becoming a trend, enhancing safety and functionality in vehicles [29][34]. Product and Client Expansion - The company is diversifying its product offerings beyond lighting systems to include domain controllers and other high-value electronic components, which are essential for modern vehicles [2][43]. - The client base is expanding globally, with new projects secured from major automotive manufacturers, indicating a robust pipeline for future growth [16][39]. Financial Projections - Revenue is projected to grow significantly from 60.22 billion CNY in 2024 to 99.72 billion CNY in 2026, with a corresponding increase in net profit [3][44]. - The company is expected to maintain a healthy gross margin around 29% over the forecast period, reflecting efficient cost management and product mix optimization [44].