Company Coverage
Shuanghuan Driveline (002472 CH): 2Q26 Results Preview: Core Business Overall Solid, But Reported Earnings Impacted By Forex Loss
BUY (Maintained)
Current price:
Target price:
Upside:
Rmb36.95
Rmb52.00
+40.7%
Analyst
Analyst
Highlights
- We expect 2Q26 revenue of Rmb2,331m (+7.7% yoy, +11.3% qoq), gross margin of 27.8% (+0.5ppt yoy, +0.3ppt qoq) and operating profit of Rmb399m (+6.7% yoy, +10.6% qoq). Its reported net profit of Rmb312m (+3.8% yoy, +10.0% qoq) is expected to be below market’s estimates of Rmb320m due to a forex loss of around Rmb10m.
- Maintain BUY and keep target price unchanged at Rmb52.00 as we rollover to 2027 estimates and adjust our multiple to 25.2x PE, still pegged to 1.3x forward PEG.
Analysis
- Headline operating numbers largely in line; expect forex to impact bottom line. We expect Shuanghuan Driveline (Shuanghuan) to report 2Q26 revenue of Rmb2,331m (+7.7% yoy, +11.3% qoq), gross margin of 27.8% (+0.5ppt yoy, +0.3ppt qoq) and operating profit of Rmb399m (+6.7% yoy, +10.6% qoq). Its reported net profit of Rmb312m (+3.8% yoy, +10.0% qoq) is expected to be below market’s estimates of Rmb320m due to a forex loss of around Rmb10m. Stripping that out, adjusted net profit should be relatively in line.
- Growth of NEV gears are returning to expansion after a slower 1Q as the high-ASP/high-margin coaxial gearbox gears start to pick up meaningfully. Capacity is running at 100% utilisation, driven by robust orders from existing clients as well as new design wins. On the other hand, the differential sub-assembly business is contributing more meaningfully while production at new overseas BEV projects is ramping up. Overall, we now expect 2Q26 EV-gear revenue to reach Rmb1b (+18.0% yoy and +23.8% qoq) and further accelerate in 2H26.
Highlights
- We expect 2Q26 revenue of Rmb2,331m (+7.7% yoy, +11.3% qoq), gross margin of 27.8% (+0.5ppt yoy, +0.3ppt qoq) and operating profit of Rmb399m (+6.7% yoy, +10.6% qoq). Its reported net profit of Rmb312m (+3.8% yoy, +10.0% qoq) is expected to be below market’s estimates of Rmb320m due to a forex loss of around Rmb10m.
- Maintain BUY and keep target price unchanged at Rmb52.00 as we rollover to 2027 estimates and adjust our multiple to 25.2x PE, still pegged to 1.3x forward PEG.
Analysis
- Headline operating numbers largely in line; expect forex to impact bottom line. We expect Shuanghuan Driveline (Shuanghuan) to report 2Q26 revenue of Rmb2,331m (+7.7% yoy, +11.3% qoq), gross margin of 27.8% (+0.5ppt yoy, +0.3ppt qoq) and operating profit of Rmb399m (+6.7% yoy, +10.6% qoq). Its reported net profit of Rmb312m (+3.8% yoy, +10.0% qoq) is expected to be below market’s estimates of Rmb320m due to a forex loss of around Rmb10m. Stripping that out, adjusted net profit should be relatively in line.
- Growth of NEV gears are returning to expansion after a slower 1Q as the high-ASP/high-margin coaxial gearbox gears start to pick up meaningfully. Capacity is running at 100% utilisation, driven by robust orders from existing clients as well as new design wins. On the other hand, the differential sub-assembly business is contributing more meaningfully while production at new overseas BEV projects is ramping up. Overall, we now expect 2Q26 EV-gear revenue to reach Rmb1b (+18.0% yoy and +23.8% qoq) and further accelerate in 2H26.
BUY (Maintained)
Current price:
Target price:
Upside:
Rmb36.95
Rmb52.00
+40.7%
Analyst
Analyst
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