Sungrow Power Supply(300274) 平安证券·2024-11-01 11:30Investment Rating - The report maintains a "Recommend" rating for Sungrow Power (300274 SZ) [1] Core Views - The company's revenue growth remains steady, with a lag in revenue recognition that is expected to be released in subsequent periods [4] - Profitability remains strong, with a gross margin of 31 3% for the first three quarters, up 2 9 percentage points year-on-year [4] - The company plans to issue GDRs to expand global production capacity and consolidate its competitive advantage, with a total fundraising amount not exceeding RMB 4 9 billion [7] - The company's global competitiveness in the PV inverter and energy storage markets is strong, with a robust order book and excellent profitability expected to continue [8] Financial Performance - In the first three quarters of 2024, the company achieved revenue of RMB 49 946 billion, a year-on-year increase of 7 6%, and net profit attributable to the parent company of RMB 7 6 billion, a year-on-year increase of 5 2% [3] - In the third quarter, revenue was RMB 18 926 billion, up 6 4% year-on-year and 2 8% quarter-on-quarter, while net profit attributable to the parent company was RMB 2 64 billion, down 8 0% year-on-year and 7 8% quarter-on-quarter [3] - The company's gross margin for the first three quarters was 31 3%, with quarterly gross margins of 36 7%, 29 5%, and 29 5% respectively [4] - The company's operating cash flow improved significantly in the third quarter, with a net cash flow from operating activities of RMB 3 41 billion, a quarter-on-quarter increase of RMB 5 5 billion [6] Future Outlook - The company's energy storage business is progressing smoothly, with revenue recognition expected to be delayed until the fourth quarter or 2025 due to the project-based nature of its large-scale storage business [4] - The company's global market competitiveness is expected to remain strong, with a projected net profit attributable to the parent company of RMB 11 891 billion, RMB 14 559 billion, and RMB 16 195 billion for 2024, 2025, and 2026 respectively [8] - The company's revenue is expected to grow to RMB 89 206 billion, RMB 112 875 billion, and RMB 131 070 billion for 2024, 2025, and 2026 respectively, with corresponding net profit growth rates of 26 0%, 22 4%, and 11 2% [5] Industry and Market Position - Sungrow Power operates in the power equipment and new energy industry, with a strong position in the global PV inverter and energy storage markets [1] - The company's market capitalization is RMB 182 9 billion, with a circulating market capitalization of RMB 16 48 billion [1] - The company's total share capital is 2 073 billion shares, with 1 59 billion A-shares in circulation [1]