Zhejiang MTCN Technology (003026) Great Wall Securities·2024-09-18 07:09Investment Rating - The report maintains a "Buy" rating for the company, indicating an expected stock price increase of over 15% relative to the industry index within the next six months [11]. Core Insights - The company has turned profitable in the first half of 2024, with significant year-on-year growth in both revenue and net profit, driven by enhanced delivery capabilities, product quality, and increased R&D investment [2][4]. - The semiconductor market is experiencing a recovery, benefiting the company as it sees growth across its three main product lines, including monocrystalline silicon wafers, rods, and power chips [2][4]. - The company has actively repurchased shares, reflecting management's confidence in its intrinsic value and long-term growth potential [4]. Financial Performance Summary - In H1 2024, the company achieved revenue of 221 million yuan, a year-on-year increase of 31.01%, and a net profit of 11 million yuan, up 185.70% year-on-year [1][2]. - For Q2 2024, revenue reached 114 million yuan, showing a year-on-year growth of 25.38% and a quarter-on-quarter increase of 7.28% [1][2]. - The gross margin for H1 2024 was 36.66%, up 10.34 percentage points year-on-year, while the net margin was 9.27%, an increase of 11.59 percentage points year-on-year [2]. Revenue and Profit Forecast - The company is projected to achieve revenues of 496 million yuan in 2024, 609 million yuan in 2025, and 703 million yuan in 2026, with corresponding net profits of 42 million yuan, 54 million yuan, and 73 million yuan respectively [1][4]. - The expected EPS for 2024, 2025, and 2026 are 0.32 yuan, 0.41 yuan, and 0.56 yuan respectively, with P/E ratios of 90X, 70X, and 52X [4]. Market Context - The global semiconductor industry is showing signs of recovery, with a reported sales increase of 18.3% year-on-year in Q2 2024, which is expected to positively impact the company's performance [2]. - The company is positioned to benefit from the increasing demand for semiconductor products driven by advancements in IoT, 5G, and automotive electronics [2].