TRIANGLE TYRE(SH:601163)2024-05-06 01:00Investment Rating - The report maintains an "Outperform" rating for Triangle Tyre with a target price of RMB 22.08, based on a 12x PE for 2024 [3][32]. Core Insights - The company experienced significant growth in 2023, with a 117.37% year-on-year increase in net profit attributable to shareholders, driven by the normalization of economic activities, increased auto sales, strong foreign trade, stable product prices, and reduced raw material costs [2][39]. - The company is innovating with new technologies, materials, and processes, enhancing product performance and reducing energy consumption [33][14]. - The company plans to distribute RMB 0.54 billion in cash dividends for 2023, which represents 38.39% of the year's net profit attributable to shareholders [39]. Financial Performance - In 2023, the company achieved revenue of RMB 10.42 billion, a 13.03% increase year-on-year, and net profit of RMB 1.40 billion, up 89.29% [39]. - The forecast for net profit attributable to shareholders for 2024-2026 is RMB 1.47 billion, RMB 1.62 billion, and RMB 1.98 billion, respectively [3][14]. - The gross margin is expected to improve gradually, with projections of 21.5%, 22.5%, and 23.4% for 2024, 2025, and 2026, respectively [10][34]. Production Capacity and Utilization - The report anticipates an increase in production capacity utilization, estimating rates of 92%, 94%, and 100% for 2024-2026 [4]. Branding and Market Expansion - The company has been actively promoting its brand through high-speed train advertisements and sponsorship of sports events, which has enhanced its market presence [7][14].