Investment Rating - Reiterates "Buy" rating for BYD Electronics with a target price of HKD 36.7, implying a potential upside of 24% [1][2][4] Core Views - BYD Electronics is expected to achieve net profit growth of 19% and 17% YoY in 2024 and 2025, driven by strong growth in automotive electronics and incremental profit contributions from the Jabil acquisition [2] - Automotive electronics is becoming a key profit driver, expected to contribute over 30% of gross profit by 2025 [2] - AI servers are expected to start contributing revenue in 2024, further supporting long-term growth [2] - The acquisition of Jabil's assets is expected to contribute RMB 300-500 million in consolidated profit in 2024, with further cost reductions and operational improvements anticipated [2] Financial Forecasts - Revenue for 2024E and 2025E is projected at RMB 169.7 billion and RMB 180.4 billion, respectively, with slight downward revisions of 2% and 4% from previous forecasts [8][12] - Net profit for 2024E and 2025E is forecasted at RMB 4.65 billion and RMB 5.45 billion, with a 2% upward revision for 2024E and a 17% downward revision for 2025E [10][12] - Gross margin for 2024E and 2025E is expected to be 8.6% and 8.9%, respectively, reflecting a slight decline from previous estimates [11][12] Valuation - The target price of HKD 36.7 is derived using a sum-of-the-parts (SOTP) valuation method, assigning target P/E multiples of 10x, 15x, 8x, 10x, 10x, and 35x to international client assembly, international client components, Android assembly, Android components, new smart products, and automotive smart systems, respectively [14] - The automotive smart systems segment is valued at a higher multiple of 35x due to its strong growth potential [14] Business Segments - Automotive electronics is expected to maintain high growth, with stable gross margins supporting its increasing contribution to overall profitability [2] - AI servers, in partnership with NVIDIA, are anticipated to start generating revenue in 2024, adding to the company's growth drivers [2] - The Jabil acquisition is expected to enhance automation and reduce operational costs, improving overall business performance [2]
预计今明两年利润稳定增长，长期战略清晰