GalaxyCore (SH:688728) HTSC·2025-04-29 07:54Investment Rating - The investment rating for the company is "Buy" with a target price of 18.00 RMB [6][4]. Core Views - The company is expected to see revenue growth driven by mobile phone sales, but faces intense competition leading to a decline in profit margins [2][4]. - The company reported a revenue of 6.38 billion RMB for 2024, a year-on-year increase of 36%, but the gross margin decreased to 22.8% [1][2]. - The company anticipates that its 50M high-resolution products will gradually enter mass production in its own wafer factory in the second half of 2025 [3][4]. Summary by Sections Financial Performance - In 2024, the company's mobile CIS product revenue is projected to be 3.6 billion RMB, a 60% year-on-year increase, accounting for 56% of total revenue [2]. - The gross margin for mobile CIS products is expected to be 21%, down 10.4 percentage points due to fierce competition in the low-pixel mobile CIS market [2]. - The company reported a net profit of 1.9 billion RMB for 2024, a significant increase of 287% year-on-year, although below the consensus estimate of 2.2 billion RMB [1][4]. Future Projections - For 2025, the company expects to generate approximately 1 billion RMB in revenue from its 50M products, with total revenue projected to exceed 10 billion RMB as various products enter mass production [3][4]. - The company has adjusted its profit forecasts for 2025, expecting net profits of 2.0 billion RMB, 2.5 billion RMB, and 3.1 billion RMB for 2025, 2026, and 2027 respectively [4][10]. Valuation Metrics - The company is assigned an EV/EBITDA multiple of 35.2x for 2025, aligning with comparable companies in the industry [4][14]. - The target price of 18.00 RMB reflects a decrease from the previous estimate of 19.2 RMB, based on updated profit margin expectations [4][7].