WANFENG AUTO WHEEL(002085)2024-08-31 04:00Investment Rating - The report maintains a "Buy" rating for the company, with a target price of 12.87 CNY per share [6][10]. Core Insights - The company's core business shows resilient growth, with a revenue of 7.372 billion CNY in H1 2024, a year-on-year decrease of 1.80%. Excluding the impact of a specific business, revenue increased by 4.32% year-on-year. The net profit attributable to shareholders reached 398 million CNY, up 24.93% year-on-year [2]. - The lightweight magnesium alloy sector is positioned as a key development area in the automotive industry, driven by carbon neutrality goals. The company is a global leader in lightweight magnesium alloy processing and has established strategic partnerships with major automotive manufacturers [2]. - The company is also leveraging opportunities in the low-altitude economy, focusing on the independent production of critical components for general aviation aircraft, thereby creating significant technological barriers [2]. Financial Performance and Forecast - The company is projected to achieve revenues of 16.587 billion CNY, 18.060 billion CNY, and 19.849 billion CNY for the years 2024, 2025, and 2026, respectively. The expected earnings per share (EPS) are 0.45 CNY, 0.52 CNY, and 0.61 CNY for the same years, corresponding to price-to-earnings ratios (PE) of 28, 24, and 21 [3][5]. - The gross profit margin for H1 2024 was 18.49%, a decrease of 2.39 percentage points year-on-year, while the net profit margin is expected to improve in the coming years [2][9]. Business Segments - The automotive metal parts lightweight business generated 6.089 billion CNY in revenue in H1 2024, a decline of 2.22% year-on-year, while the general aviation aircraft manufacturing business achieved revenue of 1.283 billion CNY, a slight increase of 0.22% year-on-year [2]. - The company is focusing on expanding its market presence in both the automotive and aviation sectors, capitalizing on the growing demand for lightweight materials and innovative aircraft designs [2].