Core viewpoints

The company released its three-quarter report in 2023, Q3 single quarter, the company achieved operating income of 3.575 billion yuan, an increase of 58.03% over the same period last year, and net profit of 214 million yuan, down 12.89% from the same period last year. We expect company Q3 shipments of about 2GW, company shipments of 1.6GW in the first half of the year, total shipments of 3.6GW in the first three quarters, and Q4 shipments are expected to further increase, with a substantial increase in sales for the whole year. The expense rate of Q3 company during the period was 16.31%, down 3.67pct from the same period last year and 5.94pct from the previous year. With the increase of the company's sales capacity, the scale effect is gradually reflected.

Event

Sany can announce the three-quarter report of 2023, the company's revenue in the first three quarters was 7.49 billion yuan, an increase of 18.04% over the same period last year, and its net profit was 1.031 billion yuan, down 1.21% from the same period last year.

The operating income in the third quarter of 2023 was 3.575 billion yuan, an increase of 58.03 percent over the same period last year, and the net profit was 214 million yuan, down 12.89 percent from the same period last year.

Brief comment

Q3 revenue increased year-on-year, gross profit margin fell year-on-year. In the single quarter of Q3, the company achieved an operating income of 3.575 billion yuan, an increase of 58.03% over the same period last year, and a net profit of 214 million yuan, down 12.89% from the same period last year. The reason for the year-on-year increase in revenue but the decline in net profit year-on-year is due to a large year-on-year decline in gross profit margin, with Q3's gross profit margin of 14.9%, down 9.63pct from the same period last year and 5.82pct from the previous year. We believe that the decline in gross profit margin is mainly affected by the sharp decline in the average price of the industry winning bids in 2022 and the delivery of low-profit orders in the second half of the year.

We expect company Q3 shipments of about 2GW, company shipments of 1.6GW in the first half of the year, total shipments of 3.6GW in the first three quarters, and Q4 shipments are expected to further increase, with a substantial increase in sales for the whole year.

It is expected that Q3 will be transferred without wind farm. The net investment income of Q3 company is 95 million yuan, which is much lower than that of Q1 (411 million yuan) and Q2 (385 million yuan). It is expected that there will be almost no wind farm transfer in Q3. The company expects to sell 500-600MW in 2023, including the transfer of 250MW in the first half of 2023, and the transfer of 300MW by 2023Q4, which will thicken the company's profits at that time.

During the period of Q3, the expense rate decreased, and the scale effect was reflected. The expense rate of Q3 company during the period was 16.31%, down 3.67pct from the same period last year and 5.94pct from the previous year. With the increase of the company's sales capacity, the scale effect is gradually reflected.

Profit forecast and valuation: we expect the company to achieve operating income of 142.8 yuan, 206.9 yuan and 26.18 billion yuan respectively from 2023 to 2025, with a net profit of 18.38 yuan, 24.78 yuan and 2.931 billion yuan, corresponding to PE of 19.4,14.4 and 12.1 times respectively.

Risk hint

1. The risk of fluctuation in the international macroeconomic situation. There are uncertainties in the operation of the global economy, and there are some challenges for the company to conduct overseas business.

two。 Competition in the industry has intensified. The wind turbine industry has relatively excess capacity and fierce competition in the industry. Wind turbine prices have continued to decline sharply since 2021. If the industry competition intensifies further, the company's profits may be damaged.

3. Risk of price fluctuation of spare parts. The company's upstream raw material castings and forgings, spindles, gearboxes and other external procurement, upstream raw material price fluctuations, will affect the company's profitability.

4. The risk of intensified competition in offshore wind turbine business. At present, there are relatively few participants in the sea wind fan market, and more competitors enter in the future, and the competition in the sea wind fan industry may intensify.