Core Viewpoint - Huajin Securities initiates coverage of Del Corporation with a "Buy" rating, highlighting the company's robust traditional automotive parts business and breakthroughs in solid-state battery technology, unlocking a "second growth curve" in the new energy sector [1][4] Group 1: Traditional Business Strength - Del Corporation has established a global R&D layout deeply embedded in the European and American markets, with overseas R&D bases in the USA, Mexico, Germany, and Spain, expecting over 70% of overseas revenue in 2024 and the first half of 2025 [1][4] - The company has formed long-term strategic partnerships with major global automakers such as BMW, Audi, Volkswagen, and Ford, further solidifying its industry-leading position [1][4] Group 2: Core Product Performance - Del Corporation leads globally in NVH noise reduction, thermal insulation, and lightweighting, with over 20 years of technology accumulation in electric motors, pumps, and mechanical pumps [2][5] - Revenue forecasts for noise reduction, thermal insulation, and lightweight products are projected to reach 3.517 billion yuan, 3.833 billion yuan, and 4.217 billion yuan from 2025 to 2027, respectively [2][5] - The company’s traditional business growth provides sufficient cash flow and resources for new business development [2][5] Group 3: Profitability and Efficiency - Del Corporation is enhancing profitability through internal optimization and external acquisitions, with a decrease in expense ratios by 3.17 percentage points year-on-year in the first three quarters of 2025 [2][5] - The acquisition of Aizhuo Intelligent Technology's entire equity further improves business layout [2][5] - The company anticipates a more than 130% year-on-year increase in net profit attributable to shareholders and over 260% in net profit excluding non-recurring items for 2025 [2][5] Group 4: Solid-State Battery Development - Del Corporation has been investing in solid-state battery R&D since 2018, with significant upgrades expected in 2025, including the completion of a pilot production line in Shanghai [3][6] - The solid-state battery products have passed rigorous safety tests and obtained UN38.3 international certification, showcasing superior safety and high-temperature resistance [3][6] - The company has signed strategic cooperation agreements with several new energy vehicle manufacturers, accelerating the commercialization process [3][6] Group 5: Financial Projections - Huajin Securities forecasts Del Corporation's revenue to reach 4.953 billion yuan, 5.400 billion yuan, and 5.940 billion yuan from 2025 to 2027, with net profits of 157 million yuan, 222 million yuan, and 297 million yuan, respectively [4][7] - The projected EPS for the same period is 0.92 yuan/share, 1.31 yuan/share, and 1.75 yuan/share, with corresponding PE ratios of 37x, 26x, and 20x, indicating high certainty in earnings growth and ample valuation recovery potential [4][7]