EAGLERISE(CHINA)(SZ:002922) Shanghai Securities·2024-06-03 03:30Investment Rating - The report gives a "Buy" rating for the company, indicating a positive outlook for its stock performance in the coming years [48]. Core Insights - The company is well-positioned to benefit from the high demand for transformers driven by grid upgrades and renewable energy projects, particularly in overseas markets [31][32]. - The company has a strong foundation in transformer business, having developed a 35kV step-up transformer for the North American market, which has received UL certification [3]. - The company is expanding its sales channels and increasing direct sales, with a focus on overseas markets, which is expected to enhance revenue from new energy products [5][31]. Summary by Sections Company Overview - Established in 1999 and listed in 2017, the company specializes in power supply and components, aiming to provide competitive products globally [26]. - The company implements a "2+X" strategy, focusing on energy products and lighting, while also developing auxiliary products like vehicle power supplies and communication power supplies [40]. Transformer Market Outlook - The demand for transformers is high due to grid upgrades and renewable energy construction, with a reported 22% year-on-year increase in transformer exports from China, totaling 41.004 billion yuan in 2023 [2]. - The company has a robust overseas sales and service network, having established local teams in key markets like the US, Japan, and Malaysia [5][92]. Financial Performance - The company expects revenues to grow significantly, projecting 43.94 billion yuan in 2024, 53.56 billion yuan in 2025, and 69.03 billion yuan in 2026, with year-on-year growth rates of 21.04%, 21.90%, and 28.88% respectively [48][102]. - The company's net profit is projected to reach 3.59 billion yuan in 2024, 4.45 billion yuan in 2025, and 5.90 billion yuan in 2026, with substantial growth rates [48]. Product Development - The company has developed a range of products tailored for the renewable energy sector, including transformers and magnetic components, which are expected to benefit from the growth in photovoltaic demand [33][102]. - The company is continuously expanding its product line, moving from step-up transformers to distribution transformers and box-type substations [31][68].