Kehua Holdings(SH:603161) Dongxing Securities·2025-05-07 10:23Investment Rating - The report maintains a "Recommended" rating for Kehua Holdings (603161.SH) [6][4] Core Views - The company's profitability is under pressure due to declining revenue and increased asset impairment provisions, with Q1 2025 revenue at 525.60 million yuan, down 15.17% year-on-year, and net profit at 25.61 million yuan, down 40.82% year-on-year [1][2] - Despite short-term risks in the turbocharger industry, the company has significant room for market share growth, and its operational efficiency has improved since the end of large capital expenditures in 2023 [4][6] - The company has a competitive edge in core processes and R&D for its main products, which include turbine shells and intermediate shells [4] Financial Performance Summary - In Q1 2025, the gross margin was 16.68%, a decrease of 2.09% year-on-year, while the net profit margin was 4.7%, down 2.2% year-on-year [1][2] - The company reported an asset impairment loss of 27.78 million yuan in Q1 2025, accounting for 5.3% of revenue, compared to 1.60 million yuan in the same period last year [2] - Operating cash flow for Q1 2025 was 118.69 million yuan, a 3.9% increase year-on-year, indicating better cash flow performance compared to profit [3] Financial Forecast - The company forecasts net profits of 123.51 million yuan, 150 million yuan, and 179.94 million yuan for 2025, 2026, and 2027 respectively, with corresponding EPS of 0.64, 0.77, and 0.93 yuan [5][4] - Revenue is expected to grow from 2,534.05 million yuan in 2025 to 2,932.70 million yuan in 2027, reflecting a growth rate of 6.82% in 2025 and 7.56% in 2027 [5][4]