SACO(SZ:002025) Minsheng Securities·2025-04-01 06:22Investment Rating - The report maintains a "Recommended" rating for the company, indicating a potential upside of over 15% relative to the benchmark index [4][6]. Core Insights - The company reported a revenue of 5.02 billion yuan for 2024, a year-over-year decline of 19.1%, with a net profit attributable to shareholders of 0.35 billion yuan, down 53.8% year-over-year [1]. - The company is actively expanding into emerging industries and international markets, with a projected revenue growth of 13.4% for 2025, aiming for 5.7 billion yuan [1][4]. - The company experienced its first-ever quarterly loss in Q4 2024, primarily due to a slowdown in defense industry demand and insufficient order fulfillment [1][4]. Financial Performance Summary - Revenue and Profitability: In 2024, the company achieved a gross margin of 38.3%, an increase of 0.4 percentage points year-over-year, while the net margin decreased by 5.9 percentage points to 8.0% [1]. - Product Performance: The revenue from relays was 0.25 billion yuan (down 23.7%), connectors and integrated products at 3.39 billion yuan (down 23.6%), and motors and control components at 1.12 billion yuan (down 11.3%) [2]. - Cash Flow and Working Capital: The company reported a negative operating cash flow of -0.26 billion yuan for 2024, a significant decrease from 1.64 billion yuan in 2023, attributed to reduced cash collection and increased inventory [3]. Future Projections - The company forecasts net profits of 0.70 billion yuan, 0.98 billion yuan, and 1.23 billion yuan for 2025, 2026, and 2027, respectively, with corresponding price-to-earnings ratios of 37x, 26x, and 21x [4][5]. - The projected revenue growth rates for the next three years are 30.5% for 2025, 20.1% for 2026, and 15.3% for 2027 [5][12].