Investment Rating - The report assigns a "Buy" rating to the company, with a market price of RMB 118.00 and a sector rating of outperforming the market [1]. Core Insights - The company is positioned to benefit from two major growth drivers: the mandatory installation of eCall terminals by July 2027, expected to create a market worth approximately RMB 16 billion, and the potential expansion into battery lifecycle management in collaboration with leading battery manufacturers [3][8]. - Revenue is projected to grow approximately sevenfold from 2024 to 2027, with net profit expected to increase by over five times during the same period [3]. Financial Summary - The company is forecasted to achieve net profits of RMB 1.99 billion, RMB 5.39 billion, and RMB 10.86 billion for the years 2025, 2026, and 2027 respectively, with corresponding earnings per share of RMB 1.90, RMB 5.15, and RMB 10.39 [5]. - The estimated price-to-earnings ratios for these years are 62.1, 22.9, and 11.4 respectively [5]. Business Overview - The company is a leading domestic supplier of vehicle communication terminals, with a strong market position in eCall and TBOX products [8][15]. - The company has a robust client base, including major domestic automotive brands such as SAIC Motor, Chery, and BYD, and has established a significant presence in the international market [8][26]. Market Opportunities - The implementation of the eCall national standard in China is expected to replicate the surge seen during the ETC installation wave, providing a high degree of revenue certainty [44]. - The eCall system is a critical safety feature that will be mandatory in all new vehicles starting July 2027, which is anticipated to significantly boost the company's sales [44][60]. Growth Potential - The company is also exploring opportunities in energy management solutions, which are expected to become a second growth curve, particularly in the context of battery lifecycle management [8][20]. - The transition to a service-oriented model in the battery industry, driven by leading manufacturers, presents substantial growth potential for the company [20][21].

Investment Rating - The report assigns a "Buy" rating for the company, marking its first coverage [1][36][38]. Core Views - The company has shown significant growth, with a 31% year-on-year increase in net profit for Q1 2025, driven by the growth of TBox and eCall products [1][4]. - The company is positioned to benefit from the rising penetration of connected vehicles and the overall growth of the automotive industry, particularly in smart and connected solutions [8][25][26]. Summary by Sections Financial Performance - In Q1 2025, the company reported revenue of 216 million yuan, a 16.85% increase year-on-year, and a net profit of 43 million yuan, up 30.67% year-on-year [4][10]. - For the full year 2024, the company achieved revenue of 1.022 billion yuan, a 25.68% increase, and a net profit of 175 million yuan, a 37.54% increase [4][10]. - The compound annual growth rate (CAGR) for net profit from 2019 to 2024 was 47%, with revenue CAGR at 30.01% [5][11]. Business Segments - The connected vehicle terminal devices segment generated revenue of 842 million yuan in 2024, a 32.19% increase, accounting for 82.39% of total revenue, with a gross margin of 27.71% [5][15]. - The IoT smart module segment reported revenue of 136 million yuan, a decrease of 6.73%, contributing 13.28% to total revenue, with a gross margin of 24.77% [5][15]. Profitability and Cost Management - The company's gross margin improved to 29.07% in 2024, up 2.05 percentage points year-on-year, with a net margin of 17.17%, an increase of 1.48 percentage points [6][20]. - In Q1 2025, the gross margin further increased to 29.33%, with a net margin of 20.02%, reflecting effective cost management [6][20]. Market Trends and Opportunities - The global connected vehicle market is projected to reach 228.1 billion USD in 2024, with the Chinese market expected to reach 543 billion yuan [26][28]. - The company has established strong partnerships with major automotive manufacturers, enhancing its market position and growth potential [29][35]. Future Projections - Revenue forecasts for 2025-2027 are 1.339 billion yuan, 1.705 billion yuan, and 2.126 billion yuan, respectively, with net profits projected at 238 million yuan, 308 million yuan, and 377 million yuan [36][38]. - The current price-to-earnings (PE) ratios are projected to be 49, 38, and 31 for the years 2025, 2026, and 2027, respectively [36][38].