Items:
According to the company's semi-annual report for 2023, 2023H1 achieved operating income of 651 million, year-on-year + 32%, return-to-home net profit 85 million, year-on-year + 65%, and deducted non-return net profit 78 million, + 36% year-on-year. 2023Q2 realized operating income of 424 million, year-on-year + 59%, month-on-month + 86%, net profit of 65 million, year-on-year + 181%, month-on-month + 217%, deduction of non-return net profit of 62 million, + 114%, + 269%.
Comments:
Performance is in line with expectations, Q2 accounts receivable impairment has a slight impact in the short term, optimistic about the follow-up performance release. The company Q2 provides for 20 million of credit impairment losses and 18 million of all credit impairment provisions and asset impairment provisions in the first half of the year, of which the provision mainly comes from the increase in the age of receivables of Chunhua Zhongliu wind power enterprises (9.337 million yuan for the current period). The first quarter of the power grid industry is a slow season, so the second quarter of 23 earnings year-on-year and month-on-month growth rates are larger. It is expected that with the arrival of the follow-up power grid start season, the company's single-quarter profit level can continue to improve, optimistic about the follow-up performance release.
The combination of electrical appliances is eye-catching and contributes mainly to the increment. The company's revenue in the first half of the year was 650 million, an increase of 160 million over the same period last year, of which the main contribution came from combination Electric (responsible for Hunan Changgao Electric, a subsidiary). In 2023, H1 Hunan Changgao Electric achieved revenue of 310 million yuan, year-on-year + 69%, net profit 53 million yuan, year-on-year + 340%, net interest rate 17%, year-on-year + 11pcts. With the adoption of the type test of the company's 550kv combined electrical appliances and the subsequent bidding, the competitiveness of the company's combined electrical products is expected to continue to enhance in the future.
Benefiting from the construction of the main grid, the amount of winning bids in the company's network has increased significantly. According to the e-commerce platform of the State Grid, the total bid-winning amount of the first four power transmission and transformation equipment projects of the State Grid in 2023 has exceeded the whole of 22 years, and the company has won a total of 776 million yuan in the first four tenders of the State Grid. + 81% year-on-year (compared with the four batches of bidding before 22 years), of which combined electrical appliances, isolation switches and complete sets of equipment won bids of 507 million yuan, 112 million yuan and 157 million yuan, respectively. Judging from the caliber of the company's announcement, by the end of July 2023, the company's products had won a total of 637 million bids, an increase of 16% over the same period last year.
Investment suggestion: Changgaodian new deep ploughing electrical equipment for more than 20 years, the share of isolation switch is stable at the front, the combined electrical appliances grow obviously, the competitiveness of other primary and secondary equipment products continues to improve, and the market channel is gradually broadened. the company's new energy-related projects impairment risk may have been basically released, the future growth path is clear. We estimate that the company's 23-25 operating income is 18.5x226xpx 2.70 billion, the net profit attributable to the parent is 2.6pm, and the corresponding EPS is 0.41, 0.50 and 0.61 respectively. With reference to comparable companies, we give a 23-year performance valuation of 23x, corresponding to the target price of 9.5 yuan, and maintain a "push" rating.
Risk hint: the bidding or start-up of the power grid is not as expected; the market promotion of the company's new products is not as expected; the rise in the price of raw materials weakens the company's profits.