Bestechnic (Shanghai) (SH:688608) Capital Securities·2024-02-27 16:00Investment Rating - The report maintains a "Buy" rating for the company [15][22]. Core Views - The company is expected to achieve a revenue of 2.176 billion yuan in 2023, representing a year-on-year increase of 46.57%. The net profit attributable to shareholders is projected to be 124 million yuan, up 1.01% year-on-year [4]. - In Q4 2023, the company achieved a revenue of 612 million yuan, a year-on-year increase of 94.13%, but a quarter-on-quarter decrease of 6.38%. The net profit attributable to shareholders for the same quarter is expected to be 6 million yuan, down 121.20% year-on-year and 91.42% quarter-on-quarter [4]. - The company's gross margin is under pressure due to rising upstream costs and declining product prices, with an estimated overall gross margin of 34.20% for the year, down 5.17 percentage points from 2022 [4]. - The company is expanding its presence in the wearable market, particularly in smart watch chips, which are expected to contribute to revenue growth. The BES2700 series wearable main control chip has been launched and is already being used in products from well-known brands [4]. - The demand for TWS (True Wireless Stereo) earphones has shown a stable recovery, with expectations for growth driven by innovations such as AI [4]. Financial Summary - The company forecasts net profits of 124 million yuan for 2023, 279 million yuan for 2024, and 463 million yuan for 2025, corresponding to price-to-earnings ratios of 110, 49, and 30 times, respectively [4][20]. - Revenue is projected to grow from 2.176 billion yuan in 2023 to 3.570 billion yuan in 2025, with growth rates of 46.54% in 2023, 30.13% in 2024, and 26.09% in 2025 [20]. - The company's R&D expenses are expected to reach 551 million yuan in 2023, reflecting a year-on-year increase of 5.39% [4].