Maintain the “gain” rating: Considering the company's new energy installation production pace and performance forecast, EPS in 2023 was lowered to 0.53 yuan (originally 0.60 yuan), and the 2024-2025 EPS was maintained at 0.99/1.12 yuan. Maintain the target price of 16.52 yuan and maintain the “Overweight” rating.

Incident: The company released a performance forecast. The net profit for 2023 is estimated to be 4.7 to 51 million yuan, +61.2% to 74.9%; we estimate that the 4Q23 net profit of the company will be 1.4 to 180 million yuan, +60.2% to 106% year over year. We believe that the slightly lower than expected performance is mainly related to the pace of installation.

Growth in the new energy sector is driving performance, and the installed capacity is expected to maintain a high growth rate in the future. The company's 4Q23 performance growth was mainly driven by growth in the new energy sector: the company disclosed that it had put into operation 1.5 GW of wind power installations as of January 9, 2024, which is +184% compared to the end of 2022. The company revealed that the construction progress of the first phase of the Jinzhong Wind Farm (350,000 kilowatts) was slightly delayed due to forest grass and other early approval. We expect the company to make up for the new 2024E installation schedule. According to the company's announcement in December 2023, the four wind farm expansion projects declared by the company (with a total installed capacity of about 670,000 kilowatts) have been included in the second batch of new energy projects in Yunnan Province in 2023, and sufficient project reserves have laid the foundation for continued high growth.

The profits of the new projects are expected to exceed expectations, and the performance is about to explode as the installed capacity is implemented. We expect the profitability of the newly put into operation projects to remain at a high level: we believe that the estimated yield of the company's new wind power projects is conservative. In fact, key parameters such as grid electricity prices, utilization hours, and construction costs are expected to be superior to the estimated values of the project, and the company's performance is expected to explode as subsequent new energy projects are put into operation.

Risk warning: Electricity demand falls short of expectations, salt and nitrogen business operations fall short of expectations, etc.