Investment Rating - The report maintains a "Buy" rating for Tian Gong International [4][3]. Core Views - In 2023, the domestic demand was weak, leading to a decline in revenue from the company's main products. However, the rapid growth of titanium alloy products partially offset this decline. The company achieved a revenue of 5.173 billion yuan, a year-on-year increase of 1.8%, while net profit decreased by 26.5% to 370 million yuan. Due to the continued weak demand for mold steel, the net profit forecasts for 2024 and 2025 have been revised down to 526 million and 618 million yuan, respectively, with a new forecast for 2026 set at 708 million yuan [3][7]. Summary by Sections Titanium Alloy Growth - The sales revenue from titanium alloy reached 964 million yuan in 2023, a significant increase of 165.9% year-on-year, with a gross margin of 31.6%, up by 3.1 percentage points. The company began collaborating with domestic consumer electronics manufacturers, entering the 3C supply chain to supply frame materials for internationally renowned consumer electronics producers. The penetration of titanium materials in the consumer electronics sector is expected to rise, benefiting the company. Additionally, the company is actively exploring 3D printing and medical titanium alloy materials, anticipating continued growth in the titanium alloy business [3]. Powder Metallurgy and Cutting Tools - The sales revenue from cutting tools was 906 million yuan in 2023, an increase of 19.7% year-on-year, with a gross margin of 29.1%, up by 1.6 percentage points. The company's powder metallurgy capabilities have led to an increase in the proportion of high-speed steel cutting tools, raising the average selling price of cutting tools. The company aims to replace imports of powder taps and drill bits, expecting the profitability of the cutting tools segment to continue to rise [3]. Mold Steel Demand - The demand for mold steel remains weak, with sales revenue of 1.145 billion and 1.201 billion yuan in the first and second halves of 2023, respectively, resulting in an annual decline of 13.2%. The company initiated a 7,000-ton fast forging project in 2022, which commenced production in August 2023, breaking the reliance on imports for large-scale mold steel in China. The company has established connections with several automotive manufacturers for future collaborative research and market expansion [3].
更新报告：钛合金快速增长，高端切削工具占比上升