Event description

Times Electric released its 2024 annual report, achieving revenue of 24.909 billion yuan in 2024, a year-on-year increase of 13.42%; the net profit attributable to the parent company was 3.703 billion yuan, a year-on-year increase of 21.77%; The non-net profit was 3.226 billion yuan, a year-on-year increase of 24.28%.

Event Comment

Rail transit equipment and emerging equipment business developed steadily. In terms of sub-sectors, the revenue of rail transit equipment business in 2024 will be 14.636 billion yuan, a year-on-year increase of +13.37%, of which rail transit electrical equipment/rail construction machinery/communication signal system/other rail transit equipment will be 109.90/18.91/11.05/650 million yuan respectively; The revenue of emerging equipment business was 10.115 billion yuan, a year-on-year increase of +13.71%, of which the basic devices/new energy vehicle electric drive system/new energy power generation/offshore equipment/industrial converter were 41.10/25.69/20.36/8.65/535 million yuan respectively; Other business revenue was 158 million yuan, +0.17% year-on-year.

The company's subsidiary, CRRC Times Semiconductor, achieved revenue of 4.365 billion yuan, net profit of 1.193 billion yuan, net profit margin of 27.3%, and maintained a high level of profit. In terms of gross profit margin, the company's gross profit margin in 2024 will be 32.48%, a year-on-year increase of +3.87pct; In terms of net profit margin, the company's net profit margin attributable to the parent company will be 14.9% in 2024, an increase of about 1.0pct year-on-year.

The rail transit business has made steady progress. The company won the first order for new energy locomotive traction system; Locomotive autonomous driving has obtained orders of nearly 100 million yuan; The maintenance and overseas business continued to advance, and the maintenance revenue increased significantly, and a number of overseas orders were obtained in Asia, Europe and the Americas, with an amount of nearly 800 million yuan; In terms of rail construction machinery, the electrical system of the electric drive continuous tamping car has achieved the first loading application, and the high-speed rail large rail paving equipment has achieved the first breakthrough; The communication signal business continued to advance, the revenue hit a record high, the urban rail signal business won the bid for 3 lines throughout the year, the non-inductive transformation of the signal system of Changsha Line 2 was successfully completed, creating a new benchmark for localization substitution, and Ningbo Line 8 achieved the first demonstration application of the independent FAO and met the opening conditions; The power supply system won all 4 projects of Chongqing Metro, and the door segment business successfully opened up a number of new markets in China.

The emerging equipment business is strong. IGBT module delivery in the field of rail transit, power grid market share of the first in China, the power grid market won the bid for 7 lines, the first time to win a large number of overseas flexible straight project orders, the new energy market rapid breakthrough, the new energy power generation market IGBT module shipments grew rapidly, the semiconductor phase III project Yixing production line was successfully put into operation. The annual sales volume of electric drive systems for new energy passenger vehicles continued to increase, with more than 5 new customers of OEMs, and supporting OEMs to export overseas. According to the statistics of the international energy network/photovoltaic headlines, the company's photovoltaic inverter business won more than 20GW of domestic bids, ranking in the forefront of the industry, and the annual shipment exceeded 10GW. The number of new orders for wind hydrogen storage products has grown steadily, and the domestic market share of IGBT hydrogen power supply is leading.

The layout of deep-sea business has a clear idea. The company's marine equipment business is expected to have good orders in 2024 and 2025, which will consolidate the company's leading position in the market share of trenching and cable laying equipment and underwater robot ROV equipment; Adhere to the guidance of technological innovation, accelerate the R&D layout of deep-sea equipment electrification and intelligence through the collaboration of the three places, and launch new products, which are applied to scenarios such as submarine oil and gas, wind power cable laying, and submarine mining; Improve the manufacturing and delivery capabilities of the offshore equipment business, plan and lay out the construction of manufacturing capabilities and product experimental capabilities, and support product innovation and order delivery.

Maintain "Buy" rating. On the basis of consolidating and improving the rail transit business, the company has gradually expanded the market outside the rail transit market, promoted a number of businesses at the same time, and continued to be optimistic about the two-wheel drive of the company's rail transit equipment + emerging equipment. It is estimated that the net profit attributable to the parent company in 2025-26 will be 4.35 billion yuan and 4.90 billion yuan, and the corresponding PE will be 14.9 and 13.2 times respectively, maintaining the "buy" rating.



Risk Reminder 1: The risk that the investment in the rail transit industry is less than expected;

2. The risk that the business development of emerging equipment is less than expected.