CCTC(300408) 甬兴证券·2024-08-13 01:00Investment Rating - The report initiates coverage with a "Buy" rating for the company [3][10]. Core Views - The company is expected to achieve a significant increase in profit for the first half of 2024, with a projected net profit of approximately 9.51 to 10.97 billion yuan, representing a year-on-year growth of 30% to 50% [1]. - The second quarter is anticipated to show a net profit of about 5.18 to 6.64 billion yuan, indicating a year-on-year growth of 43.80% and a quarter-on-quarter growth of 36.49% [1]. - The growth is primarily driven by the recovery in downstream demand, particularly in the MLCC sector, with improvements in core products such as ceramic inserts and substrates [1]. - The company has made significant breakthroughs in high-capacity MLCC products for automotive applications, which are expected to accelerate production in 2024 [1]. - The passive component industry is anticipated to rebound, with major manufacturers considering price increases due to rising demand and costs [1]. Financial Projections - The company is projected to achieve net profits of 21.26 billion yuan, 27.55 billion yuan, and 34.52 billion yuan for the years 2024, 2025, and 2026, respectively [2]. - Corresponding EPS for these years are expected to be 1.11 yuan, 1.44 yuan, and 1.80 yuan [2]. - The PE ratios based on the closing price on August 5 are projected to be 27.91, 21.53, and 17.18 for the years 2024, 2025, and 2026, respectively [2]. Business Overview - The company is recognized as a leading supplier of passive components in China and is positioned as a platform enterprise for ceramic materials [1]. - The report highlights the company's ongoing expansion efforts, with approximately 4.3 billion yuan invested in high-capacity MLCC production, which is expected to accelerate in the coming years [1].