Anfu Technology(SH:603031) Huafu Securities·2024-06-07 02:01Investment Rating - The report assigns a "Buy" rating for the company, marking it as the first coverage [26]. Core Insights - Anfu Technology has a significant stake in Nanfu Battery, holding approximately 26.09% as of Q1 2024, with plans for further acquisitions to enhance control [1][58]. - Nanfu Battery is recognized as a leading player in the alkaline battery sector in China, with a strong market presence and brand recognition [2][25]. - The company is actively expanding its overseas market presence, achieving a remarkable 117.92% year-on-year growth in export revenue in 2023 [25][45]. - Anfu Technology is diversifying its business by investing in energy storage through Hefei Hefeng Energy, which has shown promising revenue growth [20][32]. Summary by Sections 1. Acquisition of Core Assets - Anfu Technology has transformed its business model by acquiring the parent company of Nanfu Battery, achieving control over the brand and enhancing its market position [31][58]. - The company plans to increase its stake in Nanfu Battery to approximately 42.91% through further acquisitions [50][59]. 2. Profit Forecast and Investment Recommendations - The financial projections indicate a steady growth trajectory, with expected revenues of 47.65 billion, 52.51 billion, and 57.37 billion yuan for 2024-2026, reflecting year-on-year growth rates of 10%, 10%, and 9% respectively [72]. - The net profit forecast for the same period is projected to be 1.89 billion, 2.13 billion, and 2.39 billion yuan, with corresponding growth rates of 63%, 13%, and 12% [72]. 3. Business Performance - In 2023, Anfu Technology reported a revenue of 43.18 billion yuan, a year-on-year increase of 27.62%, and a net profit of 1.16 billion yuan, up 41.93% [61]. - The company’s battery manufacturing and sales accounted for approximately 89% of its total revenue in 2023, with alkaline batteries being the primary contributor [35][39]. 4. Market Position and Strategy - Nanfu Battery maintains a dominant position in the domestic market, holding an 85.9% market share in the retail sales of alkaline batteries [25]. - The company is focusing on both domestic and international markets, leveraging its strong brand and product quality to drive growth [20][45].