Event: On April 10, 2025, the company announced its 2024 annual report, and the company achieved revenue of 1.960 billion yuan in 2024, a year-on-year increase of +49.53%; The net profit attributable to the parent company was -403 million yuan, and the net profit not attributable to the parent company was -457 million yuan, and the year-on-year loss expanded.

Revenue increased quarter-on-quarter, and R&D investment continued to be high. In 2024, the company's revenue will increase quarter-on-quarter, but due to the intensification of market competition and the pressure on product prices, the gross profit margin will decrease year-on-year. At the same time, the company's continuous investment in R&D, market development, supply chain construction and talent introduction led to an increase in expenses during the period, and an increase in the provision for asset impairment losses, resulting in a year-on-year increase in net profit attributable to the parent company. The company continued to increase R&D investment, with annual R&D expenses of 540 million yuan, a year-on-year increase of 44.57% after excluding the impact of share-based payment expenses.

The automotive electronics business drove growth, and the volume of multi-category products increased. In 2024, the company's automotive electronics field will perform well, with the proportion of revenue increasing to 36.88%, a year-on-year increase of +5.93pcts, and annual shipments reaching 363 million.

The company's market share in the core field of new energy vehicle three-electric system has further broken through. Multi-channel taillight driver chips, magnetic current sensor chips and some interface chips have entered the stage of stable mass production and large-scale shipments.

At the same time, new products such as motor drive chips, integrated motor drive SoC chips, power path protection, high/low side switches, and various sensors have obtained a number of project designations in key customers, and some of them have been mass-produced or are expected to enter the stage of large-scale mass production in 2025.

Pan-energy and consumer electronics are developing steadily. In 2024, the company's pan-energy revenue will account for 49.49%, and after experiencing industry destocking, with the gradual recovery of prosperity, shipments will continue to grow. The revenue in the consumer electronics field accounted for 13.63%, a year-on-year increase of +4.12pcts, benefiting from the recovery of market demand and the company's new products such as pressure, temperature and humidity sensors, and the proportion of revenue increased.

The acquisition of McGonn was completed, and the layout of magnetic sensors was strengthened. In 2024, the Company completed the cash acquisition of 100% of the equity interest in McGonn, which will be included in the consolidated financial statements from November 2024. The acquisition significantly strengthens the company's product portfolio and technical strength in the field of magnetic sensors. McGonn contributed revenue of 73 million yuan within two months (November to December) of the consolidation, and the integration effect was initially emerging, and the future coordinated development can be expected.

Investment advice: We expect the company's revenue in 2025/2026/2027 to be 28.08/34.23/4.087 billion yuan, and the net profit attributable to the parent company to be -0.16/2.56/513 million yuan, corresponding to 104.32/52.04 times PE in 2026/2027 respectively. Maintain "Overweight" rating.

Risk warning: the progress of new products is less than expected, industry competition is intensifying, macro demand is less than expected, and goodwill impairment risk.