Core point of view

The company released the 2024 semi-annual report, and in 2024H1, the company achieved operating income of 5.280 billion yuan, a year-on-year increase of 34.88%, and a net profit attributable to the parent company of 434 million yuan, a year-on-year decrease of 46.92%, and the company achieved operating income of 3.553 billion yuan in a single quarter in 2024Q2, a year-on-year increase of 51.09%, and the net profit attributable to the parent company was 168 million yuan, a year-on-year decrease of 49.82%. Wind turbine shipments in the second quarter were about 2.3GW, more than doubling year-on-year, and 3.3GW in the first half of the year, up 121% year-on-year. In the first half of the year, the company's fan and accessories business revenue was 4.917 billion yuan, a year-on-year increase of 68%, and the gross profit margin was 15.13%, an increase of 6.14 percentage points from the second half of last year.

Event

The company released the 2024 semi-annual report, and in 2024H1, the company achieved operating income of 5.280 billion yuan, a year-on-year increase of 34.88%, and a net profit attributable to the parent company of 434 million yuan, a year-on-year decrease of 46.92%, and realized a net profit of 388 million yuan, a year-on-year decrease of 43.23%.

In Q2 2024, the company achieved operating income of 3.553 billion yuan, a year-on-year increase of 51.09% and a month-on-month increase of 105.60%, a net profit attributable to the parent company of 168 million yuan, a year-on-year decrease of 49.82% and a month-on-month decrease of 36.87%, and a net profit of 151 million yuan, a year-on-year decrease of 45.43% and a month-on-month decrease of 36.17%.



Brief comment 2024H1&Q2 The company's revenue growth is mainly due to the high year-on-year increase in wind turbine sales, the company's wind turbine shipments in the second quarter were about 2.3GW, more than doubling year-on-year, and in the first half of the year, wind turbine shipments were 3.3GW, a year-on-year increase of 121%. In the second quarter and the first half of the year, the company's net profit and net profit attributable to the parent company decreased year-on-year, mainly due to the small number of wind farms sold in the current period and the decrease in revenue. The

gross profit margin of wind turbines continued to improve, still in the first

echelon In the first half of the year, the company's overall gross profit margin was 16.01%, an increase of 4.82 percentage points from the second half of last year; The company's fan and accessories business revenue was 4.917 billion yuan, a year-on-year increase of 68%, revenue accounted for 93%, and the gross profit margin was 15.13%, which was basically the same as in 2023, and the gross profit margin increased by 6.14 percentage points compared with the second half of last year, and the first half of the year has improved for two consecutive quarters.

The expense ratio has decreased significantly. In the first half of 2024, the company's expense ratio during the period was 15%, a year-on-year decrease of 8pct, the sales expense rate decreased by 5pct year-on-year, and the R&D expense rate decreased by 4pct year-on-year. At the beginning of 2024, the company will launch multi-department linkage and full participation to promote cost reduction and cost control, and apply and implement cost reduction methods such as strategic alliances, resource locking, and R&D innovation.

The decrease in the sale of wind farms led to a decrease in overall profits. In the second quarter of 2024, the company will have no wind farms for sale, and in the second quarter of 2023, the company's wind farm sales will generate a profit of more than 300 million yuan.

The overseas layout is progressing in an orderly manner. The company has established subsidiaries in Brazil, U.A.E., the Philippines, South Africa and other places to promote the deployment and promotion of global business; Accelerate the construction of overseas production capacity, promote the expansion of factories in India, prepare for the construction of factories in Kazakhstan, and strengthen overseas supply assurance capabilities.

Profit forecast: It is expected that the company will achieve operating income of 16.06, 230.7 and 28.34 billion yuan in 2024, 2025 and 2026 respectively, and net profit attributable to the parent company of 21.9, 2.52 and 3.06 billion yuan, corresponding to PE of 13.2, 11.5 and 9.5 times respectively, maintaining an "overweight" rating.



Risk Reminder 1. The risk of fluctuations in the international macroeconomic situation. There are uncertainties in the operation of the global economy, and there are certain challenges for the company to carry out overseas business.

2. Intensified competition in the industry. The wind turbine industry has relatively overcapacity, the industry is fiercely competitive, and the price of wind turbines has continued to decline sharply since 2021, and if the industry competition is further intensified, it may lead to the company's profitability being damaged.

3. The risk of price fluctuations of parts and components. The company's upstream raw material castings and forgings, spindles, gearboxes and other external procurement, upstream raw material price fluctuations, will affect the company's profitability.

4. The risk of intensified competition in the offshore wind turbine business. At present, there are relatively few participants in the sea wind fan market, and more competitors will enter in the future, and the competition in the sea wind fan industry may intensify.