HGTECH(000988)2025-04-19 07:00Investment Rating - The report assigns an "Outperform" rating for the company, marking the first coverage of the stock [6]. Core Insights - The company is expected to achieve a total operating revenue of 11.709 billion yuan in 2024, representing a year-on-year growth of 13.6%, with a net profit attributable to shareholders of 1.221 billion yuan, up 21.24% year-on-year [1][4]. - The company is actively expanding its international market presence, with overseas revenue reaching 1.38 billion yuan in 2024, a growth of 25.6% [2][25]. - The company has three main business segments: connectivity, perception, and intelligent manufacturing, all showing significant growth [2][10]. Revenue and Profit Forecast - The company forecasts revenues of 15.641 billion yuan, 20.505 billion yuan, and 24.584 billion yuan for 2025, 2026, and 2027 respectively, with net profits of 1.582 billion yuan, 1.965 billion yuan, and 2.318 billion yuan for the same years [4][70]. - The report anticipates a significant increase in the demand for high-speed optical modules, particularly driven by AI developments, with expected revenue growth rates of 67%, 52%, and 25% for the connectivity business from 2025 to 2027 [70]. Business Performance - The connectivity business generated 3.975 billion yuan in revenue in 2024, a year-on-year increase of 23.75%, primarily driven by AIGC applications [2][25]. - The perception business achieved revenue of 4.095 billion yuan, with sensor revenue at 3.668 billion yuan, reflecting a 12.9% growth [2][25]. - The intelligent manufacturing segment reported revenue of 3.492 billion yuan, growing by 9.45% year-on-year [2][25]. Margin and Cost Control - The company's gross margin for 2024 is reported at 21.55%, a slight decrease of 1.56 percentage points year-on-year, but is expected to improve as high-speed optical modules ramp up production [3][29]. - The company has maintained good cost control, with sales, management, and R&D expense ratios showing minor changes [3][29]. Market Trends - The optical communication market is experiencing robust demand, particularly in telecommunications and data communication sectors, with a combined market size exceeding 100 billion USD [37]. - The report highlights the increasing importance of AI in driving demand for optical modules, particularly in data centers [40][45]. Competitive Landscape - The company is positioned as a leader in the laser manufacturing industry, with a strong focus on innovation and technology development [73]. - The report notes that the company has established a competitive edge through its proprietary technologies and cost advantages in optical chip production [66][70].