Incident: The company announced that in 2024Q1, it achieved revenue of 549.32 billion yuan, an increase of 4.7%; net profit of 14.92 billion yuan, an increase of 1.2%; and realized net profit without deduction of 14.739 billion yuan, an increase of 1.1%.
The structure of the housing construction business continues to be optimized, and energy and water-related businesses in the infrastructure business are growing rapidly.
On the revenue side, housing construction, infrastructure construction and investment, and survey and design business achieved revenue of 3658/1277/2.6 billion yuan respectively, up 4.7%/6.4%/2.5% respectively; achieved gross profit of 226.1/109.2/2.8, respectively, 6.5%/8.3%/-20.8%, respectively; and achieved gross profit margins of 6.2%/8.6%/10.8%, respectively, compared with 0/0.1/-3.2pct, respectively. Looking at the order situation, the company's construction industry achieved new signings of 1110.7 billion yuan in 2024Q1, an increase of 14.3%. By business, the company's housing construction, infrastructure, and survey design achieved new signings of 8062/3005/40 billion yuan, respectively, 11.4%/23.2%/-3.6%, and industrial plants in the housing construction business achieved a year-on-year increase of 39.8%; energy, water and environmental protection, water conservancy and water transportation orders in the infrastructure business achieved rapid growth, achieving new signings of 940/365/75 billion yuan, respectively, 234.8%/86.4%/155.7% compared with the same period. Looking at the subregions, domestic and overseas signings reached 10,883/22.4 billion yuan respectively, or 13.9%/38.4% year-on-year, respectively.
The gross margin of the housing development business rebounded. 2024Q1 achieved revenue of 46.5 billion yuan, an increase of 8.8%; gross profit of 8.8%; gross profit margin of 19.2%; contract sales of 77.8 billion yuan decreased by 30.8%; contract sales area of 2.63 million square meters decreased 48%; land reserves of 84.87 million square meters at the end of the period decreased by 6.9%; the company insisted on precise investment, selection from the best, and newly purchased land reserves of about 1.62 million square meters increased by 138.2%, mainly located in first-tier and strong second-tier cities. Currently, the boom in the real estate industry is still low. As a leading real estate development enterprise, the company's market share is expected to increase further after the industry is cleared, and it may benefit first in the future with strong financing advantages and market reputation.
Investment advice: We predict that the company's net profit for 2024-2026 will be 566.2/595.3/63.62 billion yuan, a year-on-year growth rate of 4.3%/5.1%/6.9%. The latest closing price corresponding to 2024-2026 PE will be 4.0/3.8/3.5 times, respectively, maintaining the “increase” rating.
Risk warning: macroeconomic downside risk, steady growth falling short of expectations, customer credit risk.