NJEC(SH:600699) Haitong Securities·2024-03-06 16:00Investment Rating - The investment rating for the company is "Outperform the Market" [2][6][7] Core Insights - The company, Junsheng Electronics, is a global leader in automotive electronics and safety, with a strong focus on innovation and international expansion. It has established partnerships with major automotive manufacturers and has a diversified product portfolio that includes domain controllers, human-machine interaction systems, and safety solutions [6][7][9]. - The automotive safety business has shown continuous improvement in profitability, with a revenue of approximately 18.7 billion yuan in the first half of 2023, representing a year-on-year growth of about 15%. The net profit attributable to the parent company reached approximately 396 million yuan, a significant increase of about 385% year-on-year [6][9]. - The automotive electronics segment is expected to grow significantly, with a revenue of approximately 8.3 billion yuan in the first half of 2023, reflecting a year-on-year increase of about 24%. The company secured new orders worth approximately 21.6 billion yuan in the same period, indicating strong demand in the context of the global shift towards electric and intelligent vehicles [6][9]. Financial Summary - The company’s projected financial performance for 2023-2025 includes: - Revenue growth of 12.4% in 2023, 10.2% in 2024, and 8.5% in 2025, with total revenues expected to reach approximately 66.91 billion yuan by 2025 [8][18]. - Net profit attributable to the parent company is forecasted to be approximately 1.09 billion yuan in 2023, 1.47 billion yuan in 2024, and 1.91 billion yuan in 2025, reflecting substantial growth rates of 176.1% and 34.7% respectively [8][18]. - The company’s earnings per share (EPS) are expected to be 0.77 yuan in 2023, 1.04 yuan in 2024, and 1.36 yuan in 2025 [8][18]. Market Position and Competitive Advantage - Junsheng Electronics has established a strong global presence, particularly in Southeast Asia and Mexico, capitalizing on the trend of Chinese automotive brands expanding internationally. The company’s early globalization strategy provides it with a competitive edge in responding to local market needs and regulations [7][9]. - The automotive safety segment is positioned as a leader in the global market, consistently ranking among the top two in market share for three consecutive years. The company has a robust technological foundation and a long-standing relationship with over 80 automotive manufacturers [9][12].