LCXX(SZ:000977) Dongguan Securities·2025-04-10 09:09Investment Rating - The report maintains a "Buy" rating for the company, indicating an expectation that the stock will outperform the market index by more than 15% in the next six months [9]. Core Insights - The company achieved significant growth in 2024, with total revenue reaching 114.77 billion yuan, a year-on-year increase of 74.24%, and a net profit attributable to shareholders of 2.29 billion yuan, up 28.55% year-on-year [5][6]. - The demand for AI servers remains strong, with the company maintaining a leading position in the global server market, ranking second worldwide and first in China for server market share [6]. - The company is well-positioned to benefit from the AI wave, as major domestic internet companies are increasing their capital expenditures on AI-related infrastructure [6]. Financial Performance Summary - In 2024, the company reported a total revenue of 114.77 billion yuan and a net profit of 2.29 billion yuan, with a significant increase in revenue and profit margins [5][6]. - The company's gross profit margin for 2024 was 6.85%, a decrease of 3.19 percentage points year-on-year, attributed to a higher proportion of sales from major internet clients [6]. - The company’s cash flow from operating activities decreased by 81.18% year-on-year, primarily due to increased inventory and procurement payments [6]. Market Position and Product Development - The company continues to focus on cloud computing, big data, and AI, with a strong market presence in server and storage products [6]. - The launch of the "Yuan Brain Enterprise Intelligence" platform and the "Yuan 2.0-M32" open-source model demonstrates the company's commitment to enhancing AI capabilities [6]. - The company has introduced innovative products, including the NF8260G7 AI general-purpose server, which can run large models efficiently [6]. Future Earnings Projections - The company is projected to achieve revenues of 155.96 billion yuan in 2025 and 187.17 billion yuan in 2026, with corresponding net profits of 3.18 billion yuan and 3.92 billion yuan [7]. - The expected earnings per share (EPS) for 2025 and 2026 are 2.14 yuan and 2.64 yuan, respectively, with price-to-earnings (PE) ratios of 21 and 17 [7].