Zhejiang Jiemei Electronic And Technology (SZ:002859) Tianfeng Securities·2024-04-26 06:00Investment Rating - The report maintains a "Buy" rating for the company, with a target price indicating an expected return of over 20% within the next six months [6][20]. Core Insights - The company achieved a revenue of 363 million yuan in Q1 2024, representing a year-over-year increase of 17.87%. The net profit attributable to the parent company was 53 million yuan, up 69.19% year-over-year, and the net profit excluding non-recurring items was also 53 million yuan, reflecting a 70.39% increase year-over-year [1][2]. - The company is the only comprehensive production enterprise in China that integrates cutting, punching, adhesive tape, plastic carrier tape, release film production, and is optimistic about the recovery of downstream demand in MLCC and semiconductor sectors [1][4]. - The company is steadily advancing its capacity expansion plans, with new production lines being launched and existing facilities undergoing upgrades to enhance production efficiency [3][4]. Summary by Sections Financial Performance - In Q1 2024, the company reported a sales gross margin of 39.22%, which is an increase of 6.81 percentage points year-over-year and 3.27 percentage points quarter-over-quarter, indicating improved profitability [2]. - The company expects to optimize its product structure and accelerate the market development of high-value-added products, which will further enhance profitability [2]. Capacity Expansion and Product Development - The fifth electronic special paper production line began trial production in December 2023, and the company is progressing with its expansion projects, including a new production line for electronic component packaging tape, which has reached an annual capacity of 3.25 million rolls [3]. - The second phase of the BOPET film project is expected to double the production capacity by the end of 2024, while the flow-cast film project is also set to increase capacity significantly [3]. High-End Product Validation - The company is actively promoting its self-made base film release products, with several specifications already validated and entering small-batch trial use. This is expected to drive future revenue growth [4]. - The focus on high-end release films is anticipated to enhance the company's profitability through stable increases in shipment volumes [4]. Investment Outlook - The report expresses a long-term positive outlook for the company, emphasizing the synergy among its three main business areas and the ongoing expansion efforts in response to growing downstream demand [4]. - The profit forecast for 2024-2026 has been adjusted, with expected net profits of 351 million yuan for 2024, 479 million yuan for 2025, and 600 million yuan for 2026 [4].