Actions(SH:688049) Great Wall Securities·2024-05-24 11:32Investment Rating - The report upgrades the investment rating to "Buy" based on the company's continuous optimization of product structure and expected improvement in profitability due to the rapid growth of high-end audio and smartwatch chips [4][21]. Core Viewpoints - The company is experiencing steady revenue growth in 2023, driven by a recovery in consumer electronics demand and the introduction of new products across various product lines [2][34]. - The company has successfully penetrated domestic and international leading brand clients, with significant sales growth in Bluetooth audio SoC chips and smartwatch SoC chips [2][23]. - The gross margin for 2023 is reported at 43.73%, an increase of 4.39 percentage points year-on-year, while the net margin is at 12.51%, a slight decrease of 0.45 percentage points [2]. Financial Performance Summary - In 2023, the company achieved a revenue of 520 million yuan, a year-on-year increase of 25.4%, and a net profit of 65 million yuan, up 21% year-on-year [34]. - The projected revenue for 2024 is 682 million yuan, with a growth rate of 31%, and the net profit is expected to reach 89 million yuan, reflecting a growth rate of 36.1% [6][27]. - The company's gross margin is expected to improve to 45% in 2024, with a net margin of 13% [6][27]. Product Line and Market Strategy - The company has become a mainstream supplier for high-end Bluetooth audio SoC chips, with significant sales growth in low-latency, high-quality wireless audio products [23]. - The first-generation smartwatch chip series has seen rapid market penetration, with shipments exceeding 10 million units in 2023 [23][36]. - The company is focusing on expanding its customer base and market reach, with plans to introduce advanced chip products to meet the growing AI demands in smart terminal devices [4][23].