YADEA(HK:01585) Huachuang Securities·2024-03-25 16:00Investment Rating - The report maintains a "Strong Buy" rating for Yadea Holdings (01585.HK) with a target price of HKD 21, compared to the current price of HKD 13.04 [1]. Core Views - Yadea Holdings achieved a revenue of HKD 34.76 billion in 2023, representing a year-on-year increase of 11.9%, and a net profit attributable to shareholders of HKD 2.64 billion, up 22.2% year-on-year [1]. - The company demonstrated steady sales growth in 2023, with a total sales volume of 16.52 million units, an 18% increase year-on-year, and a 6% sales growth in the second half of 2023 despite a weak industry demand [1]. - Yadea's market share increased to 30% in 2023, up 3 percentage points from 2022, indicating a consolidation of market share among leading brands [1]. - The gross margin for the second half of 2023 was 17%, with a slight increase of 0.1 percentage points from the first half of 2023, and the company expects to improve profitability through new product launches and cost efficiency [1]. - The acquisition of Wuxi Lingbo Electronics aims to enhance Yadea's capabilities in upstream core components, further strengthening its competitive position [1]. Financial Summary - The main financial indicators for Yadea Holdings are as follows: - Revenue for 2023: HKD 34.76 billion, with a projected growth of 12% in 2024 and 15% in 2025 [2]. - Net profit for 2023: HKD 2.64 billion, with expected growth rates of 20% in 2024 and 17% in 2025 [2]. - Earnings per share (EPS) forecasted to be HKD 0.86 in 2024, HKD 1.03 in 2025, and HKD 1.20 in 2026 [2]. - Price-to-earnings (P/E) ratio projected to be 11.5 in 2024, 9.8 in 2025, and 8.9 in 2026 [2]. - The company has a total market capitalization of HKD 40 billion and a debt-to-asset ratio of 67% [4].