Wuxi Best Precision Machinery (300580) Minsheng Securities·2025-04-18 14:23Investment Rating - The report maintains a "Buy" rating for the company [5][8]. Core Views - The company is a leader in the turbocharger components industry, with a three-tiered strategic layout that positions it for future growth. The revenue scale continues to grow, with a compound annual growth rate (CAGR) of 10.9% from 2019 to 2023. In Q1-Q3 2024, the company achieved revenue of 1.04 billion yuan, a year-on-year increase of 3.5%, and a net profit attributable to shareholders of 220 million yuan, up 7.1% year-on-year [3][4][5]. Summary by Sections 1. Introduction - The report provides an in-depth analysis of the company, which has been focused on precision component manufacturing since its establishment. It has expanded its business boundaries and formed a three-tiered industrial strategy covering traditional precision components, new energy vehicle components, and linear motion functional components [13]. 2. Precision Component Leader - The company has a rich product matrix, with turbocharger components being the main revenue source, accounting for over 70% of total revenue since 2019. The company has established long-term stable business relationships with major manufacturers in the turbocharger and engine sectors [28][31]. 3. Turbocharger Components - The company continues to deepen its internal capabilities, establishing a solid foundation for performance. The increasing strictness of passenger car emission standards is expected to drive the penetration rate of turbochargers. The market for turbocharger components is projected to grow steadily, with expected revenues of 1.12 billion, 1.22 billion, and 1.33 billion yuan from 2024 to 2026, representing year-on-year growth rates of 10%, 9.5%, and 9% respectively [3][4][5][49]. 4. New Energy Vehicle Components - The company is actively advancing its new energy vehicle components business through both organic growth and acquisitions. The first phase of the Anhui Best factory is expected to contribute approximately 810 million yuan in annual output value, with revenues projected to reach 210 million, 380 million, and 610 million yuan from 2024 to 2026, reflecting year-on-year growth rates of 40%, 80%, and 60% respectively [4][5]. 5. Linear Motion Functional Components - The company is making significant strides in the linear motion functional components sector, with plans to start mass production of planetary roller screws by 2025. Expected revenues for this segment are projected to be 10 million, 90 million, and 270 million yuan from 2024 to 2026, with year-on-year growth rates of 800% and 200% in 2025 and 2026 respectively [5][4]. 6. Financial Forecast and Investment Recommendations - The company is expected to achieve revenues of 1.5 billion, 1.88 billion, and 2.41 billion yuan from 2024 to 2026, with year-on-year growth rates of 12%, 25%, and 28%. Net profits attributable to shareholders are projected to be 310 million, 380 million, and 520 million yuan, with growth rates of 19%, 23%, and 35% respectively. The report suggests a price-to-earnings (PE) ratio of 42, 34, and 25 for the years 2024 to 2026 [5][7][34].