Introduction to this report:
New signings increased 20% in '22, of which the Belt and Road Initiative increased 40% (69% of overseas) and new energy increased 84%; on-hand orders at the end of the period increased 13%, a guarantee factor of 5 times. A total of 30 GW was obtained in the wind and solar energy development index.
Key points of investment:
Maintain the increase in holdings. The performance was slightly lower than expected. The forecast for 2023-24 EPS of 0.22/0.25 yuan (originally 0.23/0.26 yuan) increased 16/ 15%, and the 2025 EPS of 0.29 yuan was predicted to increase 14%. Maintain the target price of 3.4 yuan, corresponding to 15.6 times PE in 2023.
Net profit increased by 20% in '22, slightly lower than expected, and net interest rate increased by 0.11pct. (1) Revenue of 366.4 billion yuan increased 14% (Q1-4 increased 16/8/23/ 11% in a single quarter), and net profit of 7.8 billion yuan increased 20% (Q1-4 in a single quarter increased 16/20/37/ 16%). (2) Gross profit margin 12.42% (-0.74pct), net interest rate of 2.13% (+0.11pct), weighted ROE of 8.46% (-0.09pct), including impairment of 2.5 billion (+36%). (3) Net operating cash flow of 7.9 billion (-10%), balance ratio of 74.79% (+3.10pct), accounts receivable of 73 billion (+28%).
New signings increased by 20% in '22, leading to rapid growth in new signings along the road and new energy sources, and the order guarantee factor was 5 times greater.
(1) In '22, the number of new contracts signed was 104.91 billion, of which 165 billion new contracts were signed in the “Belt and Road” market increased 40%, accounting for 69% of overseas contracts. (2) Looking at newly signed businesses, construction of 991 billion yuan increased by 24% (94%), of which new energy and integrated smart energy increased 84% (34%) to 355 billion yuan, traditional energy increased 24% (24%), urban construction increased 212.2 billion increased 23% (20%), and integrated transportation fell 60% (5%). (3) Orders on hand at the end of the period increased 13% to 181.72 billion, a guarantee factor of 5 times.
The investment and operation business received a total of 30GW of new energy development indicators, and the fixed increase was approved by the State Assets Administration Commission. (1) In '22, the acquisition target for wind energy development increased by 40% to 16 GW, with a total acquisition of 30 GW; additional grid-connected Fengguang New Energy Holdings had an installed capacity of 2.4 GW, with a cumulative total of 5 GW. (2) The operating mileage of Expressway Holdings at the end of the period was 1,130 kilometers. (3) The announcement on October 23, '22 proposed an increase of no more than 15 billion dollars for new energy projects such as photovoltaics, wind power, and energy storage. The announcement on March 14, '23 was approved by the State Assets Administration Commission.
Risk warning: macroeconomic policies have been tightened beyond expectations, infrastructure investment has fallen short of expectations, etc.