Tianneng Battery (688819) 海通国际·2024-10-10 00:00Investment Rating - The report assigns an "Outperform" rating to the company, with a target price of RMB 54.39 based on a 21x PE valuation for 2024 [2][12]. Core Insights - The company is a leader in the lead-acid battery sector, holding over 45% market share in lead-acid power batteries for light electric vehicles. In H1 2024, it achieved revenue of RMB 21.62 billion, a year-on-year increase of 0.30%, and a net profit of RMB 1.19 billion, up 9.32% year-on-year [12][14]. - Favorable industry policies are emerging, such as subsidies for electric bicycle trade-ins and relaxed weight limits for lead-acid battery models, positioning the company to benefit as an industry leader [12][14]. - The company is actively upgrading its product offerings and investing in advanced technologies, including new lead-acid and lithium-ion batteries, hydrogen engine systems, and sodium-ion batteries [12][14]. Financial Summary - Revenue projections for 2024-2026 are RMB 50.87 billion, RMB 54.42 billion, and RMB 58.45 billion, respectively, with year-on-year growth rates of 6.5%, 7.0%, and 7.4% [3][5]. - Net profit forecasts for the same period are RMB 2.51 billion, RMB 3.09 billion, and RMB 3.47 billion, reflecting growth rates of 9.1%, 23.0%, and 12.3% [3][5]. - The gross profit margin is expected to stabilize around 17.5% in 2024, improving to 18.4% by 2026 [3][5]. Product and Market Expansion - The company is enhancing its global strategy, with a new assembly plant in Vietnam expected to reach a capacity of 10 million units annually by 2025. In H1 2024, overseas sales revenue increased by 34.57% year-on-year to RMB 129 million [2][14]. - Continuous product innovation includes the launch of high-performance batteries for electric motorcycles and advanced energy storage systems, indicating a strong commitment to technology leadership [12][14].