The performance was slightly lower than market expectations. The company achieved revenue of 2,537 billion yuan in 2023, up 41.77% year on year. Among them, 2023Q4 realized actual revenue of 903 million yuan, up 32.04% year on year, up 139.02% month on month; realized net profit of 281 million yuan, up 36.71% year on year. Among them, 2023Q4 achieved net profit of 121 million yuan, up 74.04% year on year and 175.48% month on month. Overall, the performance growth was in line with expectations.
In terms of revenue structure, the revenue of energy storage system technology services increased by 123.11%, and the share of revenue increased to 28.62%. The company's energy storage system technical service revenue was 726 million yuan, accounting for 28.62% of the company's revenue, an increase of 123.11% over the previous year, achieving rapid growth, mainly due to the completion and acceptance of some large-scale energy storage EPC projects during the reporting period. Revenue from test inspection and commissioning services increased by 64.73% year on year, mainly due to the increase in grid-side test and inspection business and business growth brought about by newly acquired subsidiaries; revenue from intelligent distribution equipment increased 31.85% year on year, mainly due to the company's self-developed iNOS system and core module revenue; revenue from intelligent monitoring equipment increased steadily, up 5.04% year on year, mainly due to the increase in video monitoring devices, fault location devices, etc.; affected by the industry's annual procurement cycle, robot and drone business revenue decreased 7.36% year on year.
The overall gross margin declined slightly due to changes in the business structure. The company's technical service revenue accounted for 55.25%, a significant increase from 43.77% last year, with energy storage system technical services accounting for 28.62%; due to the low gross margin of energy storage system services and the increase in its revenue share, the company's comprehensive gross margin fell 0.68pct year-on-year to 28.98%; the company's gross margin of test, inspection and commissioning services reached 42.34%, and the gross margin of smart devices reached 31.99%, which basically remained high in history.
Based in Guangdong, we are actively expanding the scale of our business outside the province and continuously breaking down geographical barriers. The company actively developed business outside the province, accounting for 29.36% of revenue, with a year-on-year increase of 63.56%, maintaining a high historical level; the company's power side test and inspection business won the bid for projects such as Guangxi 600MW coal power units, the commissioning of two 9H combustion engines from Sichuan, and Guineng Jingneng intelligent power generation platform research and development projects, and the power grid side test and inspection business won the bid for the Guizhou Power Grid Infrastructure Project. It also won the bid for the Guangxi Power Grid Framework Project for the first time, while acquiring Guizhou Chuangxing and Guangxi Guineng Company to further expand the scale of regions outside the province and continue to break the scale of regions outside the province Barriers to increase revenue Elasticity.
Profit forecast and investment suggestions: Based on the industry's investment growth rate and the company's business development situation, we expect the company to achieve revenue of 3.97 billion yuan/5.50 billion yuan/6.58 billion yuan respectively in 2024-2026, and net profit to mother of 454 million yuan/631 million yuan/756 million yuan respectively. According to the DCF model, we lowered the target price from 37.79 yuan/share to 33.31 yuan/share, maintaining the “better than market” rating.
Risk warning: 1. Grid investment falls short of expectations; 2. Strong market competition has led to a sharp drop in gross margin; 3. Prices of raw materials have risen sharply.