Incident: The company released its 2023 annual report. In 2023, the company achieved revenue of 14.939 billion yuan, a year-on-year increase of 21.21%; achieved net profit of 2.07 billion yuan, an increase of 21.78% over the previous year; realized net profit deducted from non-return to mother of 1,623 billion yuan, an increase of 1.67% over the previous year; in 2023, the company plans to distribute a discovery dividend of 5.90 yuan (tax included) to all shareholders for every 10 shares. The company also released its 2024 quarterly report. In 24Q1, it achieved revenue of 1,728 billion yuan, a year-on-year increase of 10.50%; realized net profit of 266 million yuan, a year-on-year decrease of 44.92% and a year-on-year decrease of 72.77%.
Market share continued to increase, and new orders increased dramatically. According to CWEA statistics, in 2023, China's wind power added 79.37 GW of hoisting capacity, an increase of 59.3%; among them, the company added 7.41 GW of hoisting capacity, an increase of 64% year on year, and its share in the domestic market was 9.3%, an increase of 0.2 pct year on year, and the market share continued to increase. As a leading enterprise in the industry, the company performed well in terms of orders in 2023. Among them, 14.1 GW was added, which achieved significant growth and reached a record high; the external sales capacity was 7.24 GW; by the end of 2023, the company's on-hand orders were 15.89 GW, which can provide a strong guarantee for subsequent shipment growth.
Adhere to “rolling development” and increase profits by selling new energy power plants. The company adheres to the “rolling development” model and continues to sell mature power plant projects in the process of continuous investment and construction of new power plant assets to improve capital turnover efficiency. In 2023, the company transferred a total of 7 wind power projects, with a total project capacity of 609.9 MW, achieving good economic and social benefits. By the end of 2023, the company's existing wind farm capacity was 247.6 MW, and the wind farm under construction had a capacity of 2.4 GW.
High level R&D investment helps product innovation and promotes global strategies to achieve new breakthroughs overseas. In terms of product innovation, the company continues to improve the product spectrum of large megawatt models. Onshore wind turbine research and development focus has reached 15MW, offshore 10MW fan products have been installed at the Dongying Wind Power Equipment Industrial Base in Shandong. At the same time, 13MW and 16MW offshore fan products have been released. The future development of the offshore wind power market is expected to bring new performance increases to the company. In terms of overseas markets, the company has set up an overseas team in the form of “Chinese+local”, which has basically covered the world's major wind power markets; in 2023, the company achieved overseas wind power equipment in Central Asia and South Asia, achieving annual overseas revenue of 310 million yuan and a gross sales margin of 22.07%, which is higher than the domestic market of 5.25 pcts. The company actively promotes overseas market layout and lays the foundation for the rapid expansion of overseas business in the future.
Maintaining a “buy” rating: The company has sufficient orders in hand, while actively promoting products to go overseas, and the sea breeze business is also expected to achieve breakthroughs in the future. We raised the 24/25 profit forecast and introduced a 26-year profit forecast. The company is expected to achieve net profit of 24.03/28.51/3.334 billion yuan in 24-26 (3% increase/1% increase), corresponding EPS of 1.99/2.37/2.77 yuan respectively, and the current stock price corresponding to 24-26 PE is 14/12/10 times. The wind power industry is expected to maintain its growth trend in the context of carbon neutrality. The company's cost, brand, and product competitiveness advantages will ensure a steady increase in the company's market share and maintain a “buy” rating.
Risk warning: Industry competition increases risk, sea breeze market development falls short of expectations, and risk of fluctuating raw material prices.