SCC(SZ:002916) ZHONGTAI SECURITIES·2024-03-16 16:00Investment Rating - The investment rating for the company is "Buy" (maintained) with a market price of 88.92 CNY per share [2]. Core Views - The company faced pressure on its performance in 2023, primarily due to weakened demand and high costs associated with new project investments. However, long-term growth is supported by the data center, automotive, and packaging substrate sectors [6][7][8]. - The forecast for the company's net profit for 2024, 2025, and 2026 is 20.03 billion CNY, 24.35 billion CNY, and 28.4 billion CNY respectively, reflecting an optimistic outlook based on expected growth in key sectors [8]. Summary by Relevant Sections Financial Performance - In 2023, the company achieved a revenue of 135.26 billion CNY, a year-on-year decrease of 3.3%. The net profit attributable to shareholders was 13.98 billion CNY, down 14.81% year-on-year [6]. - The gross margin was 23.43%, a decline of 2.09 percentage points year-on-year, while the net margin was 10.33%, down 1.39 percentage points [6]. Business Segments - PCB Business: Revenue was 80.73 billion CNY, a decrease of 8.52% year-on-year. The automotive electronics segment saw over 50% growth in orders, driven by new customer projects and demand for advanced driver-assistance systems (ADAS) [7]. - Packaging Substrate Business: Revenue was 23.06 billion CNY, down 8.47% year-on-year. The second half of 2023 showed signs of demand recovery, particularly in storage and RF products [8]. Future Outlook - The company is expected to benefit from the recovery in the packaging substrate market and growth in the data center and automotive sectors. The projected net profit growth rates for the next three years are 43% for 2024, 16% for 2025, and 14% for 2026 [8][10].