NCE(SH:605111) Huachuang Securities·2024-03-31 16:00Investment Rating - The report maintains a "Strong Buy" rating for the company [1][2]. Core Views - The company is expected to return to a growth trajectory due to recovering downstream demand and the gradual ramp-up of new products in new fields [2]. - The company's 2023 performance was under pressure due to industry cyclicality, with a significant decline in revenue and net profit compared to the previous year [1][2]. - The fourth quarter of 2023 showed signs of recovery, with a quarter-on-quarter revenue increase and improved gross margin [1][2]. Financial Summary - In 2023, the company reported total revenue of 1.477 billion yuan, a year-on-year decrease of 18.46%, and a gross margin of 30.75%, down 6.18 percentage points [1]. - The net profit attributable to the parent company was 323 million yuan, a decline of 25.75% year-on-year [1]. - For Q4 2023, revenue was 372 million yuan, showing a year-on-year decrease of 23.05% but a quarter-on-quarter increase of 7.67% [1]. - The gross margin for Q4 2023 was 31.77%, reflecting a year-on-year decrease of 2.14 percentage points but an increase of 1.64 percentage points from the previous quarter [1]. Product and Market Development - The company is actively expanding its product offerings in the new energy sector and exploring the AI server market, which is expected to support long-term growth [2]. - The company has launched 200 automotive-grade MOSFET products and is collaborating with major clients like BYD, with products being supplied across their entire vehicle range [2]. - The company anticipates a rebound in photovoltaic energy storage demand in 2024, with new product sales expected to grow significantly [2]. Future Earnings Forecast - The company forecasts net profit attributable to the parent company of 408 million yuan for 2024, 487 million yuan for 2025, and 604 million yuan for 2026, with corresponding EPS of 1.37, 1.63, and 2.02 yuan respectively [2][13]. - The report sets a target price of 45.1 yuan per share for 2024, based on a 33 times PE ratio [2].