The target price is 9.01 yuan, maintaining the "overweight" rating.
Yutong heavy Industry released three quarterly reports that in 2023, Q1-Q3 realized revenue of 2.014 billion yuan (yoy-16.01%), net profit of 125 million yuan (yoy-47.19%) and non-net profit of 49.18 million yuan (yoy-64.81%).
Among them, Q3 realized revenue of 649 million yuan (yoy-17.88%,qoq-12.08%) and net profit of 28.17 million yuan (yoy-59.45%,qoq-58.24%). We downgrade the sales forecast of sanitation vehicles and raise the forecast of asset impairment loss. It is estimated that the EPS of the company from 2023 to 2025 will be 0.45,0.53,0.61 yuan respectively (the previous value is 0.55,0.62,0.68 yuan from 2023 to 2025). Comparable company's 24-year Wind unanimously expected the average PE to be 14.2 times. Considering the obvious advantages of the company's new energy sanitation vehicles and mining vehicles, it gave the company 17.0 times PE in 24 years, with a target price of 9.01 yuan (the previous value was 9.96 yuan) and maintained the "over-holding" rating.
The income and profit in the first three quarters declined significantly, during which the expense rate increased compared with the same period last year, and the market competition intensified, resulting in a decline in the income of the sanitation equipment business and an increase in the impairment loss of sanitation services assets, resulting in a significant decline in the company's income and profits in the first three quarters. In the first three quarters, the company's gross profit margin yoy-3.5pp to 23.5% dome 3Q23 company gross profit margin yoy-1.1pp, qoq-0.1pp to 23.1%. Against the background of a year-on-year decline in revenue in the first three quarters, the expense rate during the period increased year-on-year, with the overall yoy+0.6pp to 18.7%, of which the sales / management / finance / R & D expense rate was 10.6% respectively, with a year-on-year change of + 0.4/-0.1/+0.4/-0.2pp, and the sales expense rate increased slightly. 3Q23 company net interest rate yoy-5.0pp, qoq-5.8pp to 4.7%, net interest rate short-term pressure.
In the first three quarters, the sales volume of new energy sanitation vehicles was + 4% compared with the same period last year, and the penetration rate was + 4%. According to the insurance data of the Bank of China Insurance Regulatory Commission, 60000 sanitation vehicles were insured nationwide in the first three quarters,-8% compared with the same period last year, and 4023 new energy sanitation vehicles were sold, with a penetration rate of 6.7%, an increase of 0.8% over the same period last year.
In the first three quarters of Yutong heavy Industry, 2030 sanitation vehicles were insured,-31% compared with the same period last year, and 841 new energy sanitation vehicles were insured, compared with the same period last year. The company has focused on the R & D and production of new energy sanitation vehicles since 18 years, and the sales volume of new energy sanitation vehicles ranks among the top three in China from 18 to 22 years. Yutong heavy Industry has the accumulation of technology and quality control capabilities, well-developed sales and after-sales network, and is expected to benefit from the new energy wave of sanitation.
Revenue from sanitation services is expected to maintain steady growth.
The company's sanitation service project operation is mainly carried out by the subsidiary Aolande Environmental Technology Co., Ltd. (Aolande), covering road cleaning and cleaning, garbage collection and transportation, municipal facilities management and landscaping maintenance and other residential environment management services. Taking into account the vast market space of sanitation services in China, the market rate of sanitation will still be improved, we believe that the company's sanitation service business income is expected to maintain steady growth.
Risk hint: the sales of sanitation equipment are not as expected, the competition in the sanitation service market is intensified, and the sales growth of mining vehicles is not as expected.