Core views
The company's mining equipment and petroleum equipment revenue grew steadily in 2023. Among them, large-scale mining trucks and wide-body trucks benefited from overseas exports, and the growth rate was excellent; the revenue growth rate of Xiaogang Engine in the logistics equipment sector exceeded 35%, and telescopic forklifts achieved volume after the Indian factory was built. Dagang Electric performed well by signing new orders, providing strong support for the 2024 results. At the same time, benefiting from changes in product structure and regional structure, the gross margin of the company's main products has increased, and we are optimistic that the company's performance will grow steadily in 2024 under global layout and product iteration.
occurrences
The company released its 2023 annual report. The company achieved operating income of 20.078 billion yuan, a year-on-year increase of 30.5%, and achieved net profit of 1.929 billion yuan, an increase of 15.9% over the previous year; Q4 achieved revenue of 4.441 billion yuan, an increase of 12.8% over the previous year, and realized a net profit of 157 million yuan, a year-on-year decrease of 57.5%.
Brief review
Mining equipment and petroleum equipment are growing steadily, and the logistics equipment overseas business is growing rapidly. Looking at the business segment, ① the mining equipment sector achieved revenue of 12.501 billion yuan, an increase of 14.25% year on year; domestic revenue of 9.694 billion yuan, up 9.82% year on year, accounting for 77.55%; overseas revenue of 2,807 billion yuan, up 32.68% year on year, accounting for an increase of 3.12 pct to 22.45%; by product, mining equipment achieved revenue of 6.326 billion yuan, an increase of 6.5% year on year, and the mining vehicle sector achieved revenue of 40.26 billion yuan 100 million yuan, up 37.8% year on year. Among them, overseas sales of the mining vehicle business increased by 33.11% year on year. In addition to two India and one Russia, the main sales regions were also sold to parts of Europe and Africa. Looking ahead to 2024, mining equipment is expected to increase its market share through a comprehensive sales model, which in turn will drive a steady increase in sales; large mining trucks can reach a wider market space. Currently, the company's 240-ton electric wheel mining truck has successfully gone offline, and it is expected to enter high-end markets such as South America and Australia with the price advantages brought by electric wheel technology.
② The logistics equipment sector achieved overall revenue of 5.783 billion yuan, an increase of 25.88% year on year. China achieved 2,229 billion yuan, a year-on-year decrease of 10.41%; overseas revenue reached 3,554 billion yuan, an increase of 68.75% year on year, accounting for an increase of 15.6 pct to 61.46%. Traditional port machinery benefits from the stability of terminal throughput and the need to update and replace stock equipment. The company's overseas business in 2023 has achieved rapid development. Currently, orders in hand exceed 4 billion yuan, and the 2024 performance is strongly supported by the long delivery period. Judging from Xiaogang Machinery, the company's electrified HAECO is developing rapidly. In the context of the electrification industry chain concentrated in China, the company is holding on to its cost advantage and speeding up sales to major terminal suppliers such as Maersk. The overseas business is growing rapidly in 2023. Currently, global sales are close to 1,000 units. Electrification The product market share reached 80%.
③ The combined revenue of petroleum equipment reached 1,502 billion yuan, and the cumulative revenue from January to December increased 8% year-on-year. Petroleum equipment still maintained a high market share in the field of complete fracturing sales in 2023. At the same time, the company actively developed other businesses. Complete pipe column automation equipment was selected as heavy equipment in the top ten countries, and successfully delivered the first oil and gas collection and transportation project, and the first set of orders for drilling rig equipment was obtained.
④ Looking at the emerging business sector, a. PV: The company's entire photovoltaic industry chain production line has basically begun production. The front-end silicon wafer phase began trial production of the second phase of the project on the afternoon of December 9, 2023. The 5GW Zhuzhou base for cells and modules has already begun production. It is expected to produce 650 million TopCon cells per year, with an estimated annual output value of about 3 billion yuan after completion and delivery. b. Hydrogen Energy: In mid-April 2023, Sany Hydrogen successfully won the bid for 8 sets of 1000 Nm in the Fengguang Green Hydrogen and Ammonia Synthesis Demonstration Project in Da'an, Jilin? /h's water electrolysis hydrogen production equipment; in December, the company released the world's largest single hydrogen electrolyzer, the S series 3000 square square electrolyzer, and the GW grade green electric hydrogen production overall solution. c. Lithium battery equipment: In 2023, lithium battery equipment achieved sales of 302 million yuan through internal orders, a significant increase over the previous year. With the support of the successful operation of the first production line, the company obtained nearly 10 external orders in 2023, and is expected to expand from the inside out in 2024.
The profitability of traditional businesses has increased significantly. On the cost side, due to short-term pressure on investment in emerging businesses, benefiting from changes in product structure and regional structure, the company's gross margin increased by 3.5 pct to 26.86%. By sector, the gross margin of mining equipment increased by 1.5 pct to 27.1%, and the gross margin of logistics equipment increased by 8.1 pct to 27.3%; by product, gross margin of TBM increased 0.3 pct to 41.9% year on year, and gross margin of comprehensive mining equipment increased 3.1 pct to 19.3%, and gross margin of wide-body vehicles increased by 3.1 pct to 19.3% From 2.7 pct to 18.1%, Xiaogang Motor's gross margin increased by 7.1 pct to 32.1%. On the cost side, due to the large upfront investment in emerging businesses, the company's R&D expenses ratio increased sharply by 2.8 pct to 8.3%, and the management expenses ratio and sales expenses ratio were relatively stable, 2.6% and 6.2%, respectively. The significant increase in the cost ratio in the short term caused the company's net profit margin to fall 1.21 pct to 9.51% year on year. In the future, as emerging businesses enter a stable development range, the company's expense ratio is expected to be controlled to a certain extent.
Investment advice: The company's traditional business segment is expected to continue to be competitive. At the same time, overseas markets for new products and electrification are expanding smoothly, and the business scale is expected to continue to increase. The company is expected to achieve operating income of 23.584 billion yuan, 26.736 billion yuan and 29.076 billion yuan respectively from 2024 to 2026, with year-on-year increases of 16.30%, 13.37%, and 8.75%, and net profit to mother of 2,277 billion yuan, respectively, up 18.01%, 13.02%, and 7.72% year-on-year respectively. Corresponding PE is 6.41x, 5.67x, and 5.27x respectively, maintaining a “buy” rating.