Tonhe TECH.(300491) 华创证券·2024-04-25 14:02Investment Rating - The report gives a "Strong Push" rating to Tonghe Technology (300491) with a target price of 23.54 yuan [94] Core Views - Tonghe Technology has entered the new energy vehicle (NEV) charging module market, achieving both volume and profit growth [3] - The company has a strong technical foundation with over 20 years of experience in power supply technology, holding multiple patents and leading industry standards [3][37] - Tonghe's charging module business has seen significant growth, with revenue increasing by 142.74% YoY in H1 2023, and gross margin improving from 15.67% to 25.45% [45] - The company is expanding into overseas markets, with CE and UL certifications completed, and is expected to see significant growth in international markets starting in 2024 [64][67] - The smart grid and military power supply businesses are stable contributors to profits, with high gross margins of around 40% and 48-60% respectively [73][80] Company Overview - Tonghe Technology was founded in 1998 and has been focusing on power supply technology for over 20 years, with multiple patents and industry-leading innovations [3] - The company has four wholly-owned subsidiaries and a stable equity structure, with the top two shareholders holding 15.30% and 13.79% respectively [7] - Tonghe has a strong management team with extensive experience in the industry, including the CEO and other key executives who have been with the company for many years [9][11] Financial Performance - Revenue from the NEV charging module business is expected to grow significantly, with projected revenues of 595.2 million, 873.9 million, and 1.17 billion yuan for 2023-2025 [88] - The smart grid business is expected to generate revenues of 165.7 million, 213.9 million, and 272.0 million yuan for 2023-2025, with gross margins around 38-40% [88] - The military power supply business is projected to have revenues of 146.8 million, 161.5 million, and 177.6 million yuan for 2023-2025, with gross margins increasing from 48% to 60% [88] - Overall, the company's total revenue is expected to grow from 921.4 million yuan in 2023 to 1.64 billion yuan in 2025, with gross margins improving from 32.7% to 34.9% [88] Industry Analysis - The NEV charging module market is expected to grow rapidly, with the domestic DC charging module market projected to reach 9.4 billion yuan in 2024 and 13.4 billion yuan in 2025 [54][55] - The smart grid sector is in a long-term growth cycle, with significant investments in power infrastructure, particularly in ultra-high voltage projects [76][77] - The military power supply industry has high barriers to entry and strong customer loyalty, with domestic companies expected to benefit from the ongoing trend of import substitution [80][81] Overseas Expansion - Tonghe has obtained CE and UL certifications, paving the way for expansion into European and North American markets [64] - The company has already secured some clients in Russia, India, and Europe, with overseas module business expected to grow significantly in 2024-2025 [64] - The overseas market offers higher gross margins, with domestic companies like Youyou Green Energy achieving 44.94% gross margins in overseas markets compared to 23.79% domestically [60] Risks and Opportunities - The NEV industry's growth may not meet expectations, potentially impacting Tonghe's charging module sales [99] - Overseas expansion could face challenges due to international uncertainties, such as delays in certification or difficulties in customer acquisition [99] - The military power supply business may face risks related to capacity and the pace of import substitution [99] - Intensifying competition in the charging module industry could lead to further price declines and margin compression [99]