The company has outstanding resource endowment and continuous output of management capacity, with the development and operation of the park as the core, industrial investment and green development as the two wings, which promote each other. We are optimistic about the stable development of the company.
Profits in the first three quarters were basically flat. In the first three quarters of 2023, the company achieved revenue of 2.61 billion yuan, down 15.1% from the same period last year, and realized a net profit of 1.031 billion yuan, down 0.21% from the same period last year. The company's overall gross profit margin in the first three quarters was 49.0%, down 9.4 percentage points from the same period in 2022. Thanks to investment income, fair value change income and non-operating income, the return net profit margin increased to 39.5% compared with the same period in 2022.
The resource endowment is outstanding, the management ability output. By the end of the third quarter of 2023, the company had inventory of 11.19 billion yuan and investment real estate of 5.08 billion yuan. The company takes root in Suzhou Industrial Park and implements the "going out" strategy with successful experience. The development and operation area of 8 production-city integration parks is more than 250 square kilometers. The company's Central Park focuses on the development and operation of industrial factories, characteristic industrial parks and long-term rental apartments. as of 1H23, 1.6 million square meters of standard and designated plants have been put into operation, and the comprehensive occupancy rate of Suzhou Industrial Park, the stronghold, is over 92%. In 2023, the company established Zhongxinyuanrui, a real estate fund management platform, to serve asset management and securitization, and announced that it would promote asset securitization in a timely manner, and in the future, it is expected to achieve orderly investment exit with the help of C-REITs, shorten the development capital return cycle, and improve capital utilization and ROE.
Industrial investment shares the dividend of industrial development. The company continues to increase the scale of industrial investment, as of the end of the third quarter of 2023, the company's other non-current financial assets of 4.18 billion yuan. Industrial investment also continued to bring returns to the company. in the first three quarters of 2023, the company realized fair value change income of 253 million yuan, an increase of 166.9% over the same period last year, mainly due to an increase in the evaluated value of industrial funds; investment income was 253 million yuan, an increase of 33.17% over the same period last year. It is mainly the long-term equity investment income calculated by the equity and equity method of subsidiary companies.
Green development enhances the competitiveness of the company. The company speeds up the development of new energy, new environmental protection and other green public services. In 2023, the subsidiary Zhongxin Green Energy and a series of participating companies have cumulatively completed distributed photovoltaic grid-connected 170MW, and are under construction and reserve projects 65MW and 500MW. On the basis of consolidating and optimizing the hydropower and gas business of traditional public utilities, the company's green development business is in line with the policy direction, and also helps to enhance the competitiveness of the park management business.
Risk factors: as a park enterprise focusing on the Yangtze River Delta, the company's development and financial situation are affected by regional macroeconomic fluctuations; the business income of the company's production-city integration park is greatly affected by land transfer, and if the real estate market goes down further, the land transfer activity tends to cool, which may cause the company's business income of the production-city integration park to fall short of expectations. The valuation of industrial funds or equity projects invested by the company may fluctuate, affecting the profits of the current period.
Profit forecast, valuation and rating: the company's resource endowment is outstanding, management capacity continues to export, with park development and operation as the core, industrial investment and green development as the two wings, promote each other, we are optimistic about the stable development of the company. We maintain the company's 2023 EPS 2024 Universe 2025 forecast of 1.17, 1.41, and 1.51 yuan, referring to comparable companies Shanghai Lingang (CITIC Research Department forecast), Pudong Jinqiao, Nanjing Hi-Tech (Wind consensus forecast) 3.8-16.4 times 2023 PE valuation, considering that there is a gap between the location of the park held by the company and the core area of Shanghai, and the divestiture of the real estate business is less affected by industry cycle fluctuations. We give the company a valuation of 10 times PE in 2023, corresponding to a comprehensive average target price of about 12 yuan, maintaining the company's "buy" rating.