GPM Up Qoq, Expense Ratio Growth Dragged Down NPM
发布时间:2024-08-28 来源:华泰金融(HK)
2Q24 attributable NP reached RMB0.03bn, maintain BUY
TDG Holdings’ revenue/attributable net profit (NP) were RMB1.57/0.08bn (-21.1/-57.8% yoy) for 1H24, and RMB0.72/0.03bn (-33.1/-65.5% yoy, -14.3/-22.1% qoq). In view of the intensified competition in the electronic material and special equipment sectors, we trim our assumptions for its main products’ GPM during 2024-2026, and estimate 2024/2025/2026 attributable NP at RMB286/339/406mn (previous: RMB399/457/531mn). We value the stock at 31x 2024E PE, in line with its peers’ average on Wind consensus, for our target price of RMB7.14 (previous: RMB9.63). Maintain BUY.
GPM rose qoq in 2Q24, increase in expense ratio dragged down NPM
For 2Q24, TDG Holdings’ overall GPM/NPM were 21.13/5.19% (-0.73/-4.16pp yoy, +1.03/-0.09pp qoq). Overall expense ratio for 2Q24 was 20.06% (+4.82pp yoy, +3.15pp qoq), with sales/administrative/R&D/financial expense ratios of +3.90/+8.17/+8.50/-0.51% (+0.43/+1.87/+1.36/+1.17pp yoy, +0.69/+0.07/+1.60/ +0.79pp qoq).
Proactively expanding product lineup targeting emerging fields
During the reporting period, TDG Holdings continued to develop new magnetic material products, specifically targeting new energy vehicles, PV and energy storage, charging piles, 5G communications, and data centers, as well as high-end consumer electronics sectors. For sapphire crystal growth technology, the company focused on the processing of large-size 6-inch and 8-inch substrates, conducting in-depth R&D on key technologies to expand its market share in the mini/micro-LED substrate market. The company has mastered key technologies for the preparation of large-size piezoelectric crystals and is actively tapping into the fields of electro-optic modulators and filters. The company is dedicated to the R&D and manufacturing of special equipment for crystal materials, with broad applications in PV, sapphire, piezoelectric crystals, and the emerging semiconductor industry.
Emphasizing talent system development and incentives
TDG Holdings continues to promote workforce structure optimization strategy, improving average labor efficiency per capita through optimizing management and work processes, as well as cross-departmental collaboration mechanisms. The company has developed a professional team that is well-versed in industry applications and proficient in cutting-edge technologies, while it also implements a systematic training and incentive mechanism to construct talent echelon. In addition, the company has ramped up its efforts to attract high-end talent, particularly top process experts and industry leaders. As of 20 August 2024, the company had cumulatively repurchased 12.35mn shares intended for the employee stock ownership plan or equity incentives through centralized bidding transactions, accounting for 1.001% of the total share capital, with purchase prices ranging from RMB5.58 to RMB7.13 per share.
Risks: weaker downstream demand than we expect; intensified competition weighing on sales prices of materials and special equipment.