Hexing(603556) 国金证券·2025-03-16 02:35Investment Rating - The report gives a "Buy" rating for the company, with a target price of 58.0 CNY per share based on a 21x PE valuation for 2025, leading to an estimated market value of 28.3 billion CNY [4]. Core Viewpoints - The company has over 30 years of experience in the overseas smart meter market and has expanded into distribution and renewable energy sectors since 2015. Currently, over 60% of its revenue comes from overseas, with a year-on-year growth of 18% in overseas revenue for the first half of 2024 [1][24]. - The global smart meter market is expected to grow from 17.6 billion USD in 2024 to 37.2 billion USD by 2032, with a CAGR of 9.8%. The company is well-positioned to benefit from this growth due to its strong market presence and technological capabilities [2][49]. - The company is expected to achieve a CAGR of nearly 15% in overseas electricity business revenue from 2024 to 2026, and over 80% and 50% in renewable energy and distribution business revenue, respectively, during the same period [1][2]. Summary by Sections Company Fundamentals - The company has been a leader in the smart meter export market and has actively expanded into distribution and renewable energy sectors. Its main business segments include smart electricity products and systems (86%), smart distribution products and systems (10%), and renewable energy products (4%) [15][16][17]. - The company has established a strong overseas presence, with 14 factories and operations in over 100 countries, maintaining an overseas revenue contribution of over 60% [24][28]. Overseas Market - The global demand for smart meters is expected to remain strong, driven by the long-term trends of grid modernization and renewable energy construction. The company is well-positioned in emerging markets where smart meter penetration is low [1][2]. - The report highlights that the company has a competitive advantage in overseas markets due to its early market entry and extensive channel resources [24][28]. Domestic Market - The domestic smart meter market is projected to grow, with significant demand for upgrading distribution networks. The company is expected to benefit from new standards and high investment levels from major state-owned enterprises [3][4]. - The company is positioned among the top suppliers for major domestic networks, with a stable market share expected to grow in the coming years [3][4]. Profit Forecast and Valuation - The company is projected to achieve net profits of 1.14 billion CNY, 1.35 billion CNY, and 1.62 billion CNY for the years 2024, 2025, and 2026, respectively, reflecting growth rates of 16%, 19%, and 20% [4][7]. - The report emphasizes the company's unique platform value and solution provider attributes, which are expected to lead to a revaluation of its stock [4].