SHUANGHUAN COMPANY(SZ:002472) Capital Securities·2024-03-05 16:00Investment Rating - The investment rating for the company is "Buy" [1][9] Core Views - The company reported a revenue of 8.134 billion yuan for 2023, representing a year-on-year growth of 18.95%, and a net profit attributable to shareholders of 816 million yuan, up 40.20% year-on-year. For Q1 2024, the expected net profit is between 210 to 230 million yuan, indicating a growth of 22.75% to 34.44% year-on-year [4][5] - The company's performance exceeded expectations, driven by new project acquisitions, including contracts with Toyota and a European luxury brand for new energy electric drive gears. Additionally, existing projects have entered mass production, boosting the new energy gear business [4][5] - The company is expanding its gear business, particularly in the high-precision transmission sector, with significant market potential in the smart home and automotive fields. The establishment of a production base in Hungary is expected to enhance performance and broaden the company's competitive edge [4][5] - The company plans to spin off its subsidiary, Huan Dong Technology, for a listing on the Sci-Tech Innovation Board, which is not expected to affect the company's controlling stake. This move may dilute net profit in the short term but could lead to greater profit growth in the future [4][5] - The company has a strong focus on the gear sector and is expanding into robotics. Revenue projections for 2023-2025 are 8.43 billion, 10.4 billion, and 12.5 billion yuan, with corresponding net profits of 810 million, 1.05 billion, and 1.37 billion yuan. The current market capitalization corresponds to a PE ratio of 25.4, 19.7, and 15.2 for 2023-2025 [4][5] Summary by Sections Company Basic Data - Latest closing price: 24.38 yuan - One-year high/low: 37.53/18.09 yuan - Current PE ratio: 27.29 - Current PB ratio: 2.72 - Total shares: 853 million - Total market value: 20.794 billion yuan [2] Financial Forecast - Revenue (billion yuan): 2022A: 6.84, 2023E: 8.43, 2024E: 10.4, 2025E: 12.5 - Revenue growth rate (%): 2022A: 26.8, 2023E: 23.4, 2024E: 23.3, 2025E: 20.2 - Net profit (billion yuan): 2022A: 0.58, 2023E: 0.81, 2024E: 1.05, 2025E: 1.37 - Net profit growth rate (%): 2022A: 78.4, 2023E: 39.9, 2024E: 29.2, 2025E: 29.9 - EPS (yuan/share): 2022A: 0.68, 2023E: 0.96, 2024E: 1.24, 2025E: 1.61 - PE: 2022A: 35.6, 2023E: 25.4, 2024E: 19.7, 2025E: 15.2 [5][6]