Bafang Electric( Suzhou) (SH:603489) EBSCN·2025-05-06 01:45Investment Rating - The report maintains a "Buy" rating for the company, indicating an expected investment return exceeding the market benchmark by more than 15% over the next 6-12 months [4]. Core Views - The company's revenue for 2024 is projected at 1.357 billion yuan, a year-on-year decrease of 17.66%, with a net profit attributable to shareholders of 64 million yuan, down 50.06% year-on-year [1][3]. - Despite short-term pressures on the electric bicycle motor business, long-term demand remains strong, particularly in the European market, where inventory issues are expected to resolve by 2025, leading to growth until 2030 [2][3]. - The company has seen a significant reduction in expense ratios in Q1 2025, contributing to a year-on-year profit increase despite a decline in gross margin [2]. Summary by Sections Financial Performance - In 2024, the company achieved a revenue of 1.357 billion yuan, a decrease of 17.66% year-on-year, and a net profit of 64 million yuan, down 50.06% year-on-year [1][3]. - For Q1 2025, the company reported a revenue of 301 million yuan, an increase of 1.69% year-on-year, and a net profit of 22 million yuan, up 32.11% year-on-year [1][2]. Market Outlook - The European market is expected to recover from high inventory levels by 2025, with continued growth projected until 2030 [2]. - The U.S. market shows potential for growth due to its low current penetration rate of electric bicycles [2]. Profitability and Cost Management - The overall gross margin for Q1 2025 was 23.89%, a decrease of 4.66 percentage points year-on-year [2]. - The company effectively managed its expense ratios, with sales, management, and R&D expense ratios decreasing significantly in Q1 2025 [2]. Earnings Forecast and Valuation - The report forecasts net profits for 2025, 2026, and 2027 at 110 million yuan, 142 million yuan, and 179 million yuan, respectively, with corresponding P/E ratios of 57, 44, and 35 [3][10].