The company released its 2023 annual report and 2024 quarterly report. The performance increased by 163%/39% year-on-year respectively. The company's performance continued to improve, and its profitability was impressive; it maintained an increase in holdings rating.
Key points to support ratings
2023/2024Q1 results increased 163%/39% year on year respectively: the company released the 2023 annual report, achieving revenue of 72.251 billion yuan, up 79.47% year on year; realized net profit of 9.440 billion yuan, up 162.69% year on year, after deducting non-net profit of 9.216 billion yuan, up 172.18% year on year, in line with previous performance forecasts.
The inverter sector boomed in volume: in 2023, the global photovoltaic industry boomed. Global shipments of the company's photovoltaic inverters reached 130 GW, up 68.83% year on year, driving sales revenue in the sector up 60.97% year on year to 27.653 billion yuan; although the unit price of the company's products fell slightly by 4.65% year on year to 0.21 yuan/W, along with product cost reduction and efficiency, the sector's gross margin increased 5.51 percentage points year on year to 37.93% year on year.
The profitability of energy storage systems increased significantly: in 2023, the energy storage systems sector achieved sales volume of 10.50 GWh, a year-on-year increase of 36.36%, and the sales revenue of the sector increased 75.79% year over year to 17.802 billion yuan; product unit prices increased 28.91% year over year to 1.70 yuan/Wh, and gross margin increased 14.23 percentage points year on year to 37.47%. We believe that the unit price and profitability of the company's energy storage products have risen significantly, mainly as a result of the company's active focus on the high-end market as a leading energy storage system supplier.
The new energy development business ushered in a recovery: benefiting from the decline in upstream photovoltaic module prices, the company's new energy investment and development business ushered in a rapid recovery. In 2023, along with falling costs stimulating the release of installed demand, the company's new energy investment and development business achieved sales revenue of 24.734 billion yuan, an increase of 113.15% over the previous year; at the same time, the gross margin of the sector also rebounded to 16.36%, an increase of 4.60 percentage points over the previous year.
With leading advantages and a global layout, the company continued to grow rapidly in 2024Q1: the company also disclosed its report for the first quarter of 2024. 2024Q1 achieved net profit of 2,096 billion yuan, an increase of 39.05% over the previous year; net profit withheld from non-return to mother was 2,083 billion yuan, an increase of 42.84% over the previous year. We believe that against the backdrop of growth pressure due to a high base last year, the company has maintained a high performance growth rate, mainly benefiting from the brand advantages and diversified business layout brought about by the company's leading position.
valuations
Under the current share capital, in line with the company's annual report and the steady growth rate of the industry, we adjusted the company's 2024-2026 earnings forecast to 7.00/8.15/9.41 yuan (the original 2024-2026 forecast was 7.80/9.63-yuan), corresponding to a price-earnings ratio of 13.6/11.7/10.1 times; maintaining an increase in holdings rating.
The main risks faced by ratings
Overseas trade barriers risk; PV policies falling short of expectations; price competition exceeding expectations; energy storage industry demand falling short of expectations; raw material price increases exceeding expectations.