Introduction to this report:
The company released its 2023 performance report, and the Q4 single quarter performance growth rate improved significantly from month to month. The company continues to improve the level of digitalization and intelligence, and will also benefit from the issuance of ultra-long-term special treasury bonds and the construction of national key projects in the future.
Key points of investment:
Maintain an increase in holdings. The performance was basically in line with expectations. According to the company's performance report, the actual net profit attributable to mother in 2023 was 1.03 yuan, up 3%, and the forecast for 2024-2025 EPS was 1.16/1.25 yuan, an increase of 13/ 8%. Maintain the company's target price of 13.1 yuan, corresponding to 11.3 times PE in 2024.
Net profit due to mother increased 2.9% in 2023, of which Q4 increased 4.9%, up 5.5 percentage points from month to month. (1) In 2023, revenue of 5.53 billion yuan is expected to decrease 5.3% year over year, Q1-4 is 8.7/13.7/9.5/2.34 billion yuan down 4.8/1.2/3.1% year on year, net profit to mother of 704 million yuan increased 2.9%, Q1-4 is 0.95/1.67/0.88/353 million yuan, respectively, and is expected to increase 4.4% year-on-year after deducting non-net profit of 686 million yuan. (2) In 2023, the company aims to improve quality and efficiency, and seek progress in stability, reshape the business system and innovate the business model.
Provide leading digital overall solutions and continuously improve the level of digitalization and intelligence. (1) The company provides leading digital overall solutions in the field of transportation and urban construction, and positions itself as a technology-innovative enterprise platform with planning and design as an entry point. (2) In August 2023, 400 million yuan of convertible bonds were issued, and 280 million yuan was used for the Huasheng Innovation Center project to enhance R&D and technical capabilities in the areas of digitalization, intelligence, green and low carbon. (3) On January 10, 2024, Jiangsu Dinoni released the “Integrated Solution for Road Solution Design and Simulation” AIRoad+VRRoad, which eliminated data silos between design and simulation.
Jiangsu's leading private infrastructure design leader, benefiting from ultra-long-term special treasury bonds and the construction of key projects. (1) On March 6, 2024, the Development and Reform Commission stated that it will continuously issue ultra-long-term special treasury bonds for the next few years to encourage and support private enterprises to participate in the construction of major national projects and shortfall repair projects. (2) On January 5, 2024, it was announced that it intended to repurchase 40 to 80 million yuan, and 271.2 billion yuan had been repurchased as of February 29. (3) On March 1, 2024, it was announced that 13 major shareholders (holding 10.52% of shares) promised not to reduce their holdings until May 31.
Risk warning: macroeconomic policies have been tightened beyond expectations, infrastructure investment has fallen short of expectations, etc.