XINGYE TECH.(002674) 长江证券·2024-11-12 01:50Investment Rating - The report maintains a "Buy" rating for the company [5][6]. Core Views - In the short term, the company's performance in Q4 is expected to remain under pressure due to a weak consumption environment, but there is potential for earnings elasticity in the following year driven by overseas capacity release and active customer acquisition in the automotive leather sector [5]. - Long-term growth prospects are promising as the company expands its export business into the sports industry, having already entered the supply chains of global sports brands like VF and Adidas, which could enhance growth and valuation [5]. - The new businesses, Hongxing and Baotai, are positioned for high growth due to platform advantages and favorable industry conditions, contributing to the company's expected growth [5]. Summary by Sections Financial Performance - In Q3, the company achieved revenue of 752 million, a year-on-year increase of 1.1%, while net profit decreased by 34.9% to 53 million [3][4]. - For the first three quarters, total revenue reached 2.014 billion, with a net profit of 110 million, reflecting a year-on-year change of 3.8% and a decline of 36.8% respectively [3][4]. - The automotive leather segment showed significant growth, with expectations of over 30% revenue growth in Q3, driven by strong sales in the new energy vehicle market [4]. Profitability - The overall gross margin for Q3 declined by 0.9 percentage points to 22.8%, influenced by the main business's performance [4]. - The net profit margin fell by 3.9 percentage points to 7.0%, with various factors including increased inventory impairment losses and higher operating expenses contributing to this decline [4]. Future Projections - The company forecasts net profits for 2024, 2025, and 2026 to be 190 million, 240 million, and 280 million respectively, representing year-on-year growth rates of 0.5%, 27%, and 17% [5]. - The corresponding price-to-earnings ratios are projected to be 16, 13, and 11 times for the same years [5].