Intretech(SZ:002925) Changjiang Securities·2025-06-16 13:07Investment Rating - The investment rating for the company is "Buy" and it is maintained [11] Core Insights - The company is experiencing a turnaround after 12 quarters of operational pressure, with a confirmed inflection point. It is expected to achieve positive growth in revenue and net profit in Q4 2024 and Q1 2025, primarily driven by the core business of electronic cigarettes [3][17] - The company has set ambitious targets in its incentive plan, requiring a revenue growth rate of no less than 25% for 2025, with a target growth rate of 50% [9][21] - Future revenue growth is anticipated to come mainly from electronic cigarettes, followed by health environment and automotive electronics businesses, with improvements in the home engraving machine segment [9][17] Summary by Sections UDM Model and Competitive Advantage - The company's core business is based on the UDM model, which differs from traditional ODM by deeply integrating into customer front-end R&D and providing highly customized manufacturing and support services [6][30] - The UDM model allows the company to establish long-term, in-depth strategic partnerships with clients, enhancing its competitive edge [26][30] Historical Review and International Expansion - The company has transitioned from relying on "hit products" to a more diversified and balanced development phase, with a focus on international expansion and improved supply chain capabilities [7][49] - From 2014 to 2021, the company achieved a compound annual growth rate (CAGR) of 41% in revenue and 37% in net profit [7][49] Growth Potential and Business Segments - The innovative consumer electronics segment is expected to see revenue growth primarily from increased supply share in electronic cigarettes, alongside stable growth in home engraving machines and e-bike components [8][56] - The automotive electronics segment is projected to grow steadily, benefiting from the industry's overall growth [8][56] Financial Performance and Projections - The company has shown a recovery in net profit margins, with estimates for Q1 2025 indicating a significant year-on-year increase [9][17] - The incentive plan outlines specific revenue targets for the next few years, indicating strong confidence in future growth [21][25] Market Dynamics and Competitive Landscape - The global market for heat-not-burn (HNB) products is expected to grow, with the company positioned to benefit from its partnership with PMI, a leading player in the HNB market [60][61] - The competitive landscape shows PMI holding a dominant market share, which provides a favorable environment for the company's growth in electronic cigarettes [60][61]