STI(SZ:300416) China Post Securities·2024-03-30 16:00Investment Rating - The investment rating for Su Shi Testing (300416) has been upgraded to "Buy" [2][19]. Core Insights - The company reported a revenue of 2.117 billion yuan for 2023, representing a year-on-year growth of 17.26%. The net profit attributable to shareholders was 314 million yuan, with a growth of 16.44% [4]. - The main contributors to revenue growth were testing services and equipment sales, with respective revenues of 1.003 billion yuan and 753 million yuan, showing year-on-year growth rates of 19.45% and 23.00% [4]. - The company is focusing on expanding its capabilities in environmental and reliability testing, integrated circuit verification, and electromagnetic compatibility, while also entering new fields such as renewable energy and aerospace [4]. Financial Performance - The gross margin for 2023 was 45.6%, a decrease of 1.06 percentage points year-on-year, while the net margin improved to 17.42%, an increase of 0.16 percentage points [4]. - The company expects revenues for 2024-2026 to be 2.535 billion, 3.006 billion, and 3.528 billion yuan, with growth rates of 19.74%, 18.60%, and 17.36% respectively [19]. - The projected net profit for the same period is 387 million, 477 million, and 581 million yuan, with growth rates of 23.19%, 23.12%, and 21.78% [19]. Valuation Metrics - The current price-to-earnings (P/E) ratio is 23.46, with future P/E ratios projected to decrease to 19.05, 15.47, and 12.70 for 2024, 2025, and 2026 respectively [14]. - The price-to-book (P/B) ratio is currently at 2.92, expected to decline to 2.63, 2.33, and 2.04 over the next three years [14].