occurrences
The company released its 2023 annual report and quarterly report for the first quarter of 2024. In 2023, the company achieved operating income of 118.682 billion yuan, a year-on-year increase of 43.55%, and achieved net profit of 7.440 billion yuan, an increase of 153.20% over the previous year; realized net profit of 6.904 billion yuan after deduction, an increase of 152.09% over the previous year. In 2024, Q1 achieved operating income of 23.084 billion yuan, a year-on-year decrease of 0.30%; realized net profit to mother of 1,176 billion yuan, a year-on-year decrease of 29.09%.
Comment:
Q1 Performance was under pressure, and shipments increased year-on-year. The pressure on the company's performance is mainly affected by increased competition in the photovoltaic market, and the overall price of the main industry chain is low. In the first quarter, the company achieved a total shipment volume of 21,907 MW, including 19,993 MW of modules and 1,914 MW of silicon wafers and batteries. Total shipments increased by 51.19% over the same period last year.
N-type technology leadership highlights the leading position, and advanced production capacity is rapidly deployed. In 2023, the company maintained its lead in technology and mass production scale for N-type products. N-type components were shipped 48.41 GW in the full year of '23, an increase of 352% over the previous year. At the same time, the company continued to break through in R&D and mass production of high-efficiency N-type batteries. The highest R&D efficiency of N-type TopCon batteries reached 26.89%, and the highest R&D efficiency of perovskite laminated batteries based on N-type TopCon reached 32.33%. By the end of 23, the company had put into production more than 70 GW of high-efficiency N-type batteries. The average efficiency of mass production of N-type batteries was over 25.8%, the average mass production efficiency in the first quarter of 2024 had exceeded 26%, and the power of N-type modules was about 30W higher than that of P-type products of the same version. The company continues to build and improve integrated production. By the end of 23, the vertical integrated production capacity in the three core sectors of silicon wafers, batteries and modules reached 85 GW, 90 GW and 110 GW respectively, and the integrated production capacity support rate reached more than 85%.
Develop and explore the productivity of new photovoltaics, and change technology to reduce costs and increase efficiency. In May 2023, the company announced the construction of an integrated photovoltaic base with an annual output of 56 GW in the Shanxi Comprehensive Reform Zone. Currently, the first phase of 14 GW production capacity has been put into operation since March 2024. The construction of the base reflects the company's innovation in the photovoltaic production model and meets the new PV productivity requirements. It will promote advanced technology, scale, zero carbon, efficiency, and intelligent manufacturing, while enhancing the resilience and cost control capabilities of the supply chain.
Profit forecast and investment rating: We expect the company's 2024-2026 revenue to be 990.48, 1012.47, and 104.216 billion yuan, respectively, up -16.5%, 2.2%, and 2.9% year-on-year; net profit to mother is 5558, 67.19, and 8.259 billion yuan, respectively, -25.3%, 20.9%, and 22.9% year-on-year. The current stock price corresponding to 2024-2026 PE is 14.13, 11.69, and 9.51 times, respectively, maintaining a “buy” rating.
Risk factors: PV module demand falls short of expectations; risk of company capacity expansion falling short of expectations; macroeconomic environment risk, international trade policy risk, etc.