投资建议：公司业绩符合预期，考虑到行业国产替代持续推进、传统下游景气度回升与新能源、核电等新业务拓展，公司业绩有望快速增长，调整2023-25 年EPS 为0.94/1.14/1.34 元（原0.94/1.14/1.30），维持目标价17.58 元，增持。Introduction to this report:
The company has been deeply involved in the valve industry for 20 years. It has a wide business layout, downstream dispersion, and strong cyclical resistance. In the context of domestic substitution, the traditional downstream boom is improving, and new businesses such as superposition of new energy and nuclear power are expanding rapidly, and the company's performance is expected to grow rapidly.
Key points of investment:
Investment advice: The company's performance is in line with expectations. Considering the continued promotion of domestic substitution in the industry, the recovery in traditional downstream prosperity and the expansion of new businesses such as new energy and nuclear power, the company's performance is expected to grow rapidly. Adjust the 2023-25 EPS to 0.94/1.14/1.34 yuan (previously 0.94/1.14/1.30), maintain the target price of 17.58 yuan, and increase its holdings.
The performance was in line with expectations. The company announced that it expects to achieve annual net profit of 6.6-770 million yuan/year over year +41.6% ~ +65.2% in 2023. Corresponding to the 2023 Q4 net profit of 0.72 to 182 million yuan/YoY -40.1% ~ +52.1%. The main reasons for the expected increase in the company's performance are: 1) optimization of internal production and governance, continuous cost reduction and efficiency; 2) strong downstream conditions, and continuous growth in the company's orders and sales revenue.
There are sufficient orders on hand, and the release of production capacity has led to rapid growth in performance. The company's “January-August 2023 Operating Data Notice” revealed that the number of new orders received in January-August reached 4.42 billion yuan/+42% year-on-year, and the number of on-hand orders remained high. Furthermore, the company's production capacity has been released one after another to meet the high increase in orders, forming positive feedback, driving performance and growth. We expect the company's production capacity to reach 8 billion yuan.
Traditional downstream (chemicals, refining, oil extraction, etc.) is booming, and new businesses (LNG, offshore, nuclear power, etc.) are growing rapidly. 1) Traditional downstream benefits from the tense international situation, high oil prices, and a gradual increase in capital expenditure, which favors the growth rate of company orders. 2) LNG and hydrogen energy: The Russian-Ukrainian conflict increased Europe's demand for energy sources such as LNG, and released the need to lay LNG pipelines. With the energy transition in the Middle East, hydrogen energy construction has higher demand for valves. The company already has order cases, which are expected to bring about high-value growth. 3) Offshore engineering: Domestic orders for LNG ships and FPSO ships have increased dramatically. In the past, valves mainly relied on imports, and the company is expected to replace imports and obtain orders. 4) Nuclear power: In the future, it was revealed that the number of nuclear power units is expected to remain at 6-8 units each year. The value of valves required for a single unit is about 500 million. The company has cooperated a lot with CGN, and the foundry has first-class nuclear qualifications, and it is expected that it will continue to receive orders.
Risk warning: falling oil prices have led to a reduction in downstream capital expenditure, the expansion of polysilicon production falls short of expectations, etc.
