KSHG(SH:605333) EBSCN·2025-10-13 09:09Investment Rating - The report initiates coverage on the company with a "Buy" rating and sets a target price of 48.45 yuan, corresponding to an 18x PE for 2026E [3][12]. Core Insights - The company is a leading player in the automotive wiring harness sector, focusing on R&D, manufacturing, and sales for 28 years, with a strategic expansion into high-voltage harnesses and new energy vehicles [1][21]. - The shift towards electric and intelligent vehicles is expected to drive demand for high-voltage wiring harnesses, with the per-vehicle value projected to exceed 5,000 yuan [1][3]. - The company is enhancing its competitive edge through optimized customer structure, advanced smart manufacturing capabilities, and ongoing global expansion [2][10]. Summary by Sections Company Overview - The company has established itself as a leader in automotive wiring harnesses, expanding its product line from single harnesses to complete vehicle harness systems [21]. - It has successfully entered the supply chains of major automotive manufacturers, including Volkswagen and Daimler [21][22]. Business Growth and Opportunities - The company is experiencing rapid growth in its new energy vehicle segment, with a projected CAGR of 50.8% in revenue from 2020 to 2024 [46]. - The introduction of high-voltage harnesses is expected to significantly increase revenue and profit margins, with a forecasted net profit of 6.7 billion yuan in 2024, reflecting a 1139.2% year-on-year increase [46][54]. Financial Projections - The company’s revenue is expected to reach 9.72 billion yuan in 2025, with a net profit of 834 million yuan, indicating a 24.4% growth rate [4][12]. - The report anticipates a steady improvement in profitability, with gross margins expected to rise due to economies of scale and stabilization of raw material prices [54][56]. Competitive Advantages - The company has a strong customer base, with over 50% of its sales in 2024 coming from leading new energy vehicle manufacturers [2][10]. - Its advanced smart manufacturing capabilities are expected to enhance economic efficiency and support long-term growth [2][3]. Market Trends - The domestic passenger car wiring harness market is projected to grow to 165.9 billion yuan by 2027, with a CAGR of 14.9% from 2023 to 2027 [1][3]. - The increasing complexity of automotive architectures and the rise in data transmission needs are driving demand for more sophisticated wiring solutions [1][3].