AFR(300620) Tianfeng Securities·2024-10-28 09:00Investment Rating - The report maintains a "Buy" rating for the company, with a target price indicating a potential upside of over 20% within the next six months [7]. Core Insights - The company has demonstrated strong growth in the third quarter, primarily driven by the consolidation of Bai'an and revenue growth from its subsidiary, Jiahua Weijie. The company reported a revenue of 739 million yuan for the first three quarters, a year-on-year increase of 41%, and a net profit of 55.81 million yuan, up 20% year-on-year [1]. - Jiahua Weijie, a wholly-owned subsidiary, has rapidly increased its revenue, achieving 56.74 million yuan in the first half of 2024, a 40% increase year-on-year, with a net profit of 11.37 million yuan, up 157% [2]. - The acquisition of Bai'an has created strategic synergies, enhancing the company's competitive strength in the automotive laser radar light source module sector. Bai'an's revenue for the second quarter of 2024 was 60.52 million yuan, with a net profit of 8.59 million yuan [3]. - The company has increased its investment in thin-film lithium niobate technology, with R&D expenses rising to 109 million yuan, a 12% increase year-on-year. Financial expenses have also increased due to reduced exchange gains and higher interest costs [4]. Financial Forecast and Investment Recommendations - The report slightly adjusts profit expectations for 2024-2026, forecasting net profits of 74.17 million yuan, 118.33 million yuan, and 158.50 million yuan respectively. The company is expected to benefit from the growth in optical communication devices and chips, as well as the synergies from the acquisition of Bai'an [5]. - Financial data indicates a projected revenue growth rate of 41.46% for 2024, with an expected revenue of 1,004.25 million yuan [6].