Incidents:
The company announced its 2023 annual report. In 2023, the company achieved operating income of 36.396 billion yuan, a year-on-year increase of 13.66%; achieved net profit attributable to shareholders of listed companies of 3.274 billion yuan, an increase of 28.99%; and diluted earnings per share was 1.85 yuan/share, an increase of 27.80% year-on-year.
Comment:
Performance growth was in line with expectations. The performance of various industry sectors reached the highest level in history. The company's operating performance grew steadily in 2023. During the reporting period, it achieved total revenue of 36.423 billion yuan, an increase of 13.67% over the previous year; net profit to mother was 3.274 billion yuan, an increase of 28.99% over the previous year. The performance of the company's coal machine segment, ASIMCO, Songe, and Hengda Intelligent Control reached the highest level in history. The total revenue of the coal machine segment in the reporting period was 18.854 billion yuan, up 12.51% year on year; total revenue from the auto parts sector was 17.569 billion yuan, up 14.94% year on year.
The hydraulic bracket has set a new benchmark in the industry. According to the company's 2023 annual report, the spin-off and listing of Hengda Intelligent Control is progressing steadily. According to the company's 2023 annual report, the company won the bid and delivered the 10-meter super-high-yield hydraulic bracket project of Shaanxi Coal. The support height and working resistance of the project's hydraulic supports are currently the highest in the world. During the reporting period, the company steadily promoted the spin-off of Hengda Intelligent Control and listing on the Science and Technology Innovation Board of the Shanghai Stock Exchange. It was accepted by the Shanghai Stock Exchange and entered the review stage in September 2023. Through this spin-off, Zheng Coal Machinery (in addition to Hengda Intelligent Control and its subsidiaries) will further focus on comprehensive coal mining equipment manufacturing and auto parts business, improve the technology and quality of comprehensive coal mining equipment, and improve the high reliability, stability and ease of use of products.
Profit forecasting
Under a neutral scenario, we expect the company to achieve revenue of 405.69, 446.14, and 49,927 billion yuan in 2024-2026; net profit to mother of 37.62, 42.04, and 4.690 billion yuan; EPS of 2.11, 2.35, and 2.63 yuan/share, respectively, corresponding to 7.46, 6.68, and 5.99 times PE. Maintain the company's “gain” rating.
Risk warning
Market competition risk, market size growth falling short of expectations, risk of industry fluctuations, financial risk, and risk of changes in income tax policies.