Investment Rating - Maintain BUY rating for Minth Group, indicating potential for over 15% return over the next 12 months [1][7][14] Core Views - Minth Group's 2H24 earnings showed mixed results with revenue falling short of expectations while gross profit margin (GPM) exceeded projections. Improved operational efficiency is evident through reduced net debt, lower capital expenditures (capex), and significantly higher free cash flow, which could support future margin enhancements and increased dividend payouts [1][7] - The company is well-positioned for revenue growth in FY25-27E, driven by rapid growth in battery housing revenue and the introduction of new products that are expected to generate substantial income. Battery housing margins are anticipated to improve further in FY25E as capex decreases [1][7] Financial Summary - Revenue is projected to grow from RMB 23,147 million in FY24A to RMB 26,186 million in FY25E, reflecting a year-on-year growth of 13.1% [2][11] - Net profit is expected to increase from RMB 2,319 million in FY24A to RMB 2,719 million in FY25E, representing a 17.2% year-on-year growth [2][11] - The earnings per share (EPS) is forecasted to rise from RMB 2.02 in FY24A to RMB 2.37 in FY25E [2][11] - The projected price-to-earnings (P/E) ratio is expected to decrease from 9.9x in FY24A to 8.5x in FY25E, indicating a more attractive valuation [2][11] Share Performance - The current market capitalization of Minth Group is approximately HK 26.00, suggesting a potential upside of 20.9% from the current price of HK$ 21.50 [3][4] - The stock has shown strong performance, with a 1-month increase of 2.6% and a 6-month increase of 48.9% [5] Operational Efficiency - Free cash flow surged from RMB 131 million in FY23 to RMB 1,363 million in FY24, highlighting significant operational improvements [7] - The net gearing ratio is projected to decrease from 15.4% in FY24A to 6.4% in FY25E, indicating a stronger balance sheet [2][11]
敏实集团：Solid revenue and profit growth could continue-20250326