Core Viewpoint - The report highlights the performance of Debang Lighting, indicating a decline in revenue and net profit for 2024 and Q1 2025, while also noting a significant increase in the dividend payout ratio for 2024 [2][4]. Financial Performance - In 2024, the company achieved operating revenue of 4.431 billion yuan, a year-on-year decrease of 5.66%, and a net profit attributable to shareholders of 347 million yuan, down 7.53% [2]. - For Q1 2025, the company reported operating revenue of 998 million yuan, a decline of 8.09%, and a net profit of 62 million yuan, down 17.11% [2]. - The cash dividend payout ratio for 2024 increased significantly to 99.65%, compared to 50%, 47%, and 42% in 2021, 2022, and 2023 respectively [2]. Export and Market Challenges - The lighting business faces tariff risks, with the global lighting market maturing. In 2024, China's lighting industry export total is expected to be approximately 56.1 billion USD, a slight decrease of 0.3% year-on-year [2]. - Traditional lighting business revenue for 2024 is projected at 3.785 billion yuan, down 6.35%, with general lighting and lighting engineering construction revenues declining by 4.95% and 36.48% respectively [2]. Automotive Sector Insights - The automotive industry is experiencing intense competition, impacting the gross margin of the vehicle lighting business. In 2024, the company’s vehicle lighting segment revenue was 596 million yuan, a decrease of 4.43%, with a gross margin of 15.8%, down 3.45 percentage points [3]. - The production and sales of new energy vehicles in China saw significant growth, with production and sales increasing by 34.4% and 35.5% respectively in 2024 [3]. Profitability and Cost Management - The overall gross margin for the company in 2024 was 19.21%, a decrease of 0.14 percentage points, primarily due to declines in the gross margins of lighting engineering and vehicle lighting businesses [4]. - The company maintained stable expense ratios, with sales, management, R&D, and financial expense ratios showing slight increases [4]. Investment Recommendations - Given the uncertainties in exports and competitive pressures in the industry, the company’s net profit forecasts for 2025-2027 have been adjusted to 315 million, 328 million, and 347 million yuan respectively, with a downward adjustment of the EPS forecast [4].

Core Viewpoint - The company reported a revenue increase in 2024 but a decline in net profit, while showing strong growth in Q1 2025, indicating a recovery in market demand and improved profitability in certain segments [1][2]. Financial Performance - In 2024, the company achieved a revenue of 16.106 billion yuan, a year-on-year increase of 14.61%, while the net profit attributable to shareholders was 253 million yuan, a decrease of 31.02% [1]. - For Q1 2025, the company reported a revenue of 4.312 billion yuan, a year-on-year increase of 21.23%, and a net profit of 212 million yuan, a significant increase of 78.46% [1]. Market Demand and Business Segments - The traditional LED market showed signs of recovery in 2024, with high-end product segments maintaining strong demand, leading to improved revenue and profit in the LED business [2]. - The integrated circuit segment benefited from a recovery in downstream demand driven by artificial intelligence and consumer electronics, with the global semiconductor market continuing to recover [2]. - The demand for silicon carbide (SiC) products is growing, particularly in sectors like new energy vehicles, photovoltaic storage, and AI, indicating a potential second growth curve for the company [3]. Product Development and Capacity Expansion - The company has established a monthly production capacity of 16,000 pieces for 6-inch silicon carbide substrates and is expanding its 8-inch silicon carbide production [3]. - The company has completed a full range of silicon carbide diode products and is actively supplying to key customers, indicating strong market positioning in the industrial-grade market [3]. Investment Outlook - The company is projected to achieve revenues of 20.97 billion yuan, 25.646 billion yuan, and 31.416 billion yuan from 2025 to 2027, with net profits of 1.638 billion yuan, 2.501 billion yuan, and 3.169 billion yuan respectively [4]. - A target price of 14.78 yuan is set based on a 45 times PE ratio for 2025, maintaining a "Buy-A" investment rating [4].