Investment Rating - The report maintains a "Buy" rating for the company with a target price of 20.61 RMB [7][8]. Core Views - The company is expected to recover from the current downturn as the military industry gradually returns to normalcy, driven by the end of the "14th Five-Year Plan" [4][12]. - The company has faced significant revenue declines due to a slowdown in demand from downstream customers, with a projected revenue of 2.154 billion RMB in 2024, down 34.09% year-on-year [1][6]. - Despite the challenges, the company is actively expanding into new fields and clients, particularly in military and civilian wireless communication sectors, which are anticipated to see a recovery in demand [2][4]. Revenue and Profitability - The company's revenue for 2024 is projected at 2.154 billion RMB, with a net loss of 249 million RMB, reflecting a year-on-year decline of 156.58% [1][6]. - The gross margin for 2024 is expected to be 31.06%, down 10.79 percentage points year-on-year, while the net margin is projected at -11.55%, down 25.01 percentage points [3][4]. - The company aims to achieve a net profit of 253 million RMB in 2025, with further growth expected in subsequent years [4][12]. Financial Forecasts - The company’s revenue is expected to recover to 2.373 billion RMB in 2025, followed by 3.007 billion RMB in 2026 and 3.675 billion RMB in 2027, indicating a growth trajectory [6][12]. - The adjusted net profit forecasts for 2025, 2026, and 2027 are 253 million RMB, 322 million RMB, and 399 million RMB, respectively [4][12]. - The report anticipates a gradual improvement in gross margins, with expectations of 40.09% in 2025 [12]. Market Position and Strategy - The company continues to strengthen its position in military and civilian wireless communication, with several successful bids for military communication projects [2][4]. - The company is also focusing on technological advancements and new business areas, including 5G applications and smart systems [2][4].