ZMD(SH:688636) Minsheng Securities·2025-04-25 03:43Investment Rating - The report maintains a "Recommended" rating for the company, considering its leading position in the embedded computing industry and expansion into drone and AI sectors [5]. Core Insights - The company reported a significant increase in orders, with a year-on-year growth of 174% in hand orders by the end of Q1 2025, driven by a surge in customer demand [3]. - The company achieved a revenue of 440 million yuan in 2024, a decrease of 33.9% year-on-year, while the net profit attributable to shareholders dropped by 79.8% to 20 million yuan [3]. - In Q1 2025, the company recorded a revenue of 80 million yuan, representing a year-on-year increase of 64.7%, and turned a profit with a net profit of 10 million yuan [3]. Summary by Sections Financial Performance - In 2024, the company’s revenue was 440 million yuan, with a gross margin of 44.8%, although the net margin fell to 4.4% due to impacts from investment income and other non-operating items [3][4]. - The company’s expenses decreased by 19.8% to 170 million yuan in 2024, but the expense ratio increased by 6.9 percentage points to 39.0% [5]. - The operating cash flow improved to 60 million yuan in 2024, compared to 10 million yuan in 2023 [5]. Order and Product Performance - The company saw a substantial increase in orders, with the fastest growth in the embedded systems for missiles, which surged by 760% [3]. - In 2024, the revenue breakdown by product showed that airborne systems generated 280 million yuan (64% of total revenue), while drone and commercial aerospace revenues grew by 88.5% and 89.5%, respectively [4]. Future Projections - The company is expected to achieve net profits of 120 million yuan, 179 million yuan, and 238 million yuan for the years 2025, 2026, and 2027, respectively, with corresponding PE ratios of 36x, 24x, and 18x [5][7].