News summary
The company joined hands with Hungarian Kodali to invest in the American structural parts base, with a total investment of US$49 million and a target annual output value of US$70 million. It is expected to be put into operation in 2026-2027. It can support the Korean battery factory and supply square battery structural parts, which is expected to benefit from the growth of the U.S. electric vehicle market. It is expected that net profit will increase significantly in 2024, maintain the buy rating, and target price of 134 yuan. Risk warnings include sales that fall short of expectations and intensified competition in the industry.
Newsletter text
[Jointly invested in the construction of a U.S. structural parts production base, new cooperation has broad prospects]
The company joins hands with Hungarian Kodali, and the joint investment does not exceed 0crashbandicootremasteredpc.49 billion US dollars in the construction of structural parts production bases in the United States. Among them, Kodali contributed as high as 85%, and Hungarian Kodali contributed 15%. It is expected that once the production base is completed, the annual output value is expected to reach US$70 million.
The strategy of building factories in the United States shows the localization strategycrashbandicootremasteredpcfar-reaching significance. The capacity invested and built is approximately US$70 million and is expected to be put into production between 2026 and 2027. It mainly provides core facilities for a South Korean battery factory and keeps pace with customers 'expansion in the United States. Customers 'battery production capacity in the United States is planned to be approximately 30gwh, which is expected to bring in nearly 1.2 billion yuan in structural parts demand.
The supply of square structural parts products is expected to cooperate with Ningde's U.S. technical authorized cooperation production capacity in the future. Considering the low penetration rate of the U.S. electric vehicle market, interest rate cuts may further stimulate terminal demand, and leading companies in the structural parts field will benefit greatly from the U.S. localization strategy.
The company's profits are rising steadily, and the increase in capacity utilization is expected to offset the adverse impact of rising raw material prices. It is expected that revenue growth in the second quarter will be between 25-30% month-on-month. The increase in production capacity will help hedge the pressure of rising raw material costs. The losses of overseas factories will decrease. The company's net profit margin is expected to remain above 10%, and it is expected that the net profit margin will also remain above 10% in 2024.
In terms of earnings forecast and investment recommendations, the company's earnings are stable and maintains its parent net profit forecast for 2024-2026. The forecast for net profit attributable to the parent company is 1.45 billion, 1.83 billion and 2.24 billion respectively, year-on-year increases of 20%, 26% and 23% respectively. The corresponding P/E ratios are expected to be 19 times, 15 times and 12 times. As a leading company in the field of structural parts, it has a target price of RMB 134 with a P/E ratio of 25 times for 2024, maintaining a "buy" rating.
Investment risk warnings, including factors such as sales volume falling short of expectations and intensified competition in the industry. Investors should fully consider these potential risks when making investment decisions.
