PONY(SZ:300887) Guotai Junan Securities·2024-04-24 12:32Investment Rating - The report maintains a "Buy" rating for the company, with a target price adjusted to 14.10 CNY, down from the previous forecast of 18.75 CNY. The current price is 10.44 CNY [4][19]. Core Insights - The company has recorded a significant impairment loss exceeding 140 million CNY, impacting its 2023 performance. However, the report suggests that the impact of this impairment on future performance will be limited. The company aims to improve its performance structure through continuous acquisitions, which are expected to build barriers in scale and management capabilities, leading to a gradual recovery in 2024 [19]. - The company reported a non-recurring net profit of 84 million CNY, reflecting a year-on-year decrease of 70%, slightly below expectations. The report revises the 2024-2025 EPS forecasts to 0.47 CNY and 0.61 CNY, respectively, and introduces a 2026 EPS forecast of 0.75 CNY [19]. - The company has a cash reserve of 592 million CNY and a goodwill of only 80 million CNY, indicating potential for growth through acquisitions while maintaining a higher-than-industry-average valuation of 30x PE for 2024 [19]. Financial Summary - Revenue for 2022 was 3,762 million CNY, with a projected decline to 2,468 million CNY in 2023, followed by a recovery to 2,992 million CNY in 2024, representing a year-on-year change of -34% and +21%, respectively [6]. - Operating profit (EBIT) is expected to decrease from 372 million CNY in 2022 to 188 million CNY in 2023, with a forecasted recovery to 292 million CNY in 2024 [6]. - Net profit is projected to drop from 323 million CNY in 2022 to 108 million CNY in 2023, with a significant recovery to 257 million CNY in 2024, reflecting a year-on-year change of -67% and +139%, respectively [6]. Business Structure and Margins - The company has improved its business structure, with the gross margin for automotive and other consumer goods at 46.74%, which is 4 percentage points higher than the overall gross margin. The revenue share from this segment increased to 10.43% in 2023 [19]. - The report anticipates that the company's gross margin will stabilize around 45% as low-margin businesses are phased out and new business segments expand [19]. Management and Operational Efficiency - The company has enhanced its management capabilities through acquisitions, with a reported increase in per capita output to 360,000 CNY, a year-on-year increase of 22% excluding nucleic acid testing [19]. - The report highlights that the company has acquired four firms, expanding into new measurement businesses, and is expected to replicate the growth model of leading overseas testing companies through continuous acquisitions [19].