Recodeal(SH:688800) GOLDEN SUN SECURITIES·2024-05-14 02:02Investment Rating - The report gives a "Buy" rating for the company, indicating a positive outlook based on expected growth and market positioning [28][36]. Core Views - The company is positioned to benefit from the increasing demand for automotive connectors due to the deepening of automotive intelligence and the accelerated penetration of 800V fast charging technology. It is also expected to enjoy the benefits of domestic substitution [34][39]. - Revenue projections for the company from 2024 to 2026 are estimated to be 2.282 billion, 2.981 billion, and 3.736 billion yuan, representing year-on-year growth rates of 46.7%, 30.6%, and 25.3% respectively [25][41]. Summary by Sections Industry Demand and Trends - The automotive sector, being the largest consumer segment, is expected to face demand suppression due to macroeconomic fluctuations and uncertainties in the external environment [1]. - The penetration rates of new automotive technologies, such as intelligent driving and high-voltage fast charging, may not meet expectations due to macroeconomic impacts [8]. Company Overview - The company has established a strong presence in the connector market, with a diverse product matrix and comprehensive capacity layout. It has production bases in Jiangsu and Sichuan, as well as overseas factories in Mexico and the USA [39]. - The main products include connectors and modules, with significant revenue contributions from the new energy vehicle sector, accounting for 88% of total revenue in 2023 [39]. Financial Projections - The company is expected to achieve net profits of 220 million, 290 million, and 360 million yuan from 2024 to 2026, with year-on-year growth rates of 60%, 31%, and 27% respectively [25][41]. - Gross profit margins are projected to be 25.3%, 25.5%, and 25.8% for the years 2024 to 2026 [21][41]. Competitive Landscape - The connector industry is experiencing intensified competition, which may pressure the company's profitability and lead to performance volatility [7]. - The company has a competitive edge due to its advanced technology and strong customer relationships, including partnerships with major automotive manufacturers [34]. Valuation - The report suggests a reasonable valuation of 30 times PE for the company in 2024, corresponding to a target market value of 6.6 billion yuan [28].