occurrences

On October 29, 2024, the company released the 2024 three-quarter report. According to the company announcement, 24Q1-Q3 achieved revenue of 5.982 billion yuan, +76.30% year-on-year, net profit to mother of 0.427 billion yuan, +171.48% year-on-year, and realized net profit deducted from non-mother 0.409 billion yuan, or +217.63% year-on-year.

On a quarterly basis, the company achieved revenue of 2.606 billion yuan in 24Q3, +77.05% year-on-month, and realized net profit of 0.196 billion yuan, +230.39% year-on-year, and +153.36% month-on-month, achieving net profit without deduction of 0.192 billion yuan, +251.22% year-on-year, and +157.68% month-on-month. We believe that the main reason for the year-on-month increase in the company's performance is due to the company's continued breakthroughs in key overseas markets and the continued high demand in overseas emerging markets.

Tracking bracket sales increased year-on-year, with sufficient orders in hand

According to the company's three-quarter report, the company's current orders totaled about RMB 5.99 billion, including about 5.21 billion yuan for tracking brackets, 0.752 billion yuan for fixed brackets, and 0.028 billion yuan for other businesses; in 24Q3, the company signed a new order of 7 GW (about 5.4 GW for tracking brackets), with a contract amount of about 2.5 billion yuan. Adequate on-hand orders provided a strong guarantee for the company's continued growth in subsequent shipments.

It once again won a major order from the Middle East and continued to increase production capacity overseas

In terms of orders, after receiving multiple orders in markets such as Saudi Arabia and India in the first half of the year, the company signed another GW level order in the third quarter. On October 17, CITIC and China Energy Construction Group International Engineering Co., Ltd. signed an order for the Saudi Harden 2.3 GW photovoltaic power plant project. The project will all use a 2.3 GW CITIC Skyrim II tracking system to adapt to the desert terrain and high wind scenario in western Saudi Arabia, while increasing the project's power generation capacity and yield throughout the life cycle of the power plant. After completion, the total power generation is estimated to be about 156.189 billion kilowatt-hours in 25 years.

In terms of production capacity, since this year, the company has successively laid out local production capacity in Saudi Arabia and Brazil, superimposing the company's previously built local production capacity in India, and the company's internationalization process continues to advance. Currently, CITIC has set up 6 global production bases in Changzhou, Fanchang, and Susong in China, Gujarat in India, Jeddah in Saudi Arabia, and Bahia in Brazil, with an annual delivery capacity of over 30 GW of tracking brackets.

Investment advice

We expect the company's 24-26 revenue to be 9.265/11.948/14.054 billion yuan, net profit to mother 0.709/0.946/1.159 billion yuan, respectively, and the corresponding PE is 24x/18x/15x, respectively. The company is a leading photovoltaic stent company. Continued sales of tracking brackets in overseas markets are expected to increase the company's profits. The BIPV business may bring new vitality to the company in the future and maintain a “recommended” rating.

Risk warning

Downstream demand falls short of expectations, market competition intensifies, overseas market development falls short of expectations, etc.