CHINA RAILWAY CONSTRUCTION(1186.HK):REVENUE IN LINE BUT NET PROFIT SLIGHTLY LOWER THAN CONSENSUS
CHINA RAILWAY CONSTRUCTION(1186.HK):REVENUE IN LINE BUT NET PROFIT SLIGHTLY LOWER THAN CONSENSUS
CRCC reported 2023 results, with revenue up by 3.8% YoY and net profit down by 2% YoY respectively. Despite in-line revenue, net profit was slightly lower than our and consensus estimates, mainly due to higher-than-expected finance cost and impairment loss on financial assets. The amount of newly signed contracts reached RMB3,293,870bn in 2023, representing only 1.5% YoY growth due to high base in 2022 and tight local government budgets. However, we reckon CRCC might benefit from the ongoing special refinancing bond program in 2024 in terms of new orders and cash collection process. We roll forward the unchanged 4x 24P/E to derive the new TP HK$9.09. With 91% upside, maintain BUY rating.
中國鐵建集團公佈了2023年業績，收入同比增長3.8％，淨利潤同比下降2％。儘管收入在內，但淨利潤略低於我們和共識的預期，這主要是由於財務成本高於預期和金融資產減值損失。由於2022年基數較高和地方政府預算緊張，新簽署的合同金額在2023年達到人民幣32.9387億元，同比增長僅爲1.5％。但是，我們認爲CRCC可能會在新訂單和現金收款過程中受益於2024年正在進行的特別再融資債券計劃。我們延續不變的4倍24市盈率，得出新的目標價爲9.09港元。上行空間爲91％，維持買入評級。
Key Factors for Rating
評級的關鍵因素
CRCC reported in-line revenue but slightly disappointing net profit in 2023. Gross profit maintain its growth momentum to expand by 0.3ppt and reach 10%. The 30.3% YoY growth in finance cost and 25.2% YoY growth in overall impairment loss all outpaced the 3.8% YoY revenue growth, resulting in a 2% YoY decrease in net profit. The increasing impairment mainly came from provision for financial assets such as receivables. Operating cash flow was RMB20,412m, down by 63.64% YoY compared to the high base in 2022.
CRC公佈了在線收入，但2023年的淨利潤略有令人失望。毛利保持增長勢頭，增長0.3個百分點，達到10％。財務成本同比增長30.3％，總減值損失同比增長25.2％，均超過了3.8％的收入同比增長，導致淨利潤同比下降2％。不斷增加的減值主要來自應收賬款等金融資產的準備金。運營現金流爲人民幣204.12億元，與2022年的高基數相比，同比下降63.64％。
In terms of sales breakdown, construction operation remains as CRCC's biggest revenue contributor, of which revenue increased by 2.3% YoY and accounted for 88% of overall revenue in 2023. Real estate segment delivered decent growth of 33.8% YoY, which help to offset declines in other segments, such as planning and design segment with 7.6% YoY decrease. In terms of new orders, the sluggish 1.5% YoY growth was mainly dragged by the 34.06% YoY decrease in railway projects. As stated by management team, CRCC now focuses more on project quality rather than quantity when selecting new projects.
就銷售細分而言，建築業務仍然是CRCC最大的收入來源，其中收入同比增長2.3％，佔2023年總收入的88％。房地產板塊實現了33.8％的可觀增長，這有助於抵消其他板塊的下降，例如規劃和設計板塊，同比下降7.6％。在新訂單方面，1.5％的低迷同比增長主要是受鐵路項目同比下降34.06％的拖累。正如管理團隊所說，CRC現在在選擇新項目時更多地關注項目質量而不是數量。
Operating cash flow decreased by 63.6% YoY in 2023, but still remains positive. The declining operating cash flow and increasing provisions for receivables indicates the cash collection process for some infrastructure projects still pending further improvements. We reckon the special refinancing bond program will help to bring more liquidity towards infrastructure investment.
2023年，運營現金流同比下降63.6％，但仍保持正值。運營現金流的下降和應收賬款準備金的增加表明，一些基礎設施項目的現金收款過程仍有待進一步改進。我們認爲，特別再融資債券計劃將有助於爲基礎設施投資帶來更多的流動性。
Key Risks for Rating
評級的主要風險
Slower-than-expected cash collection process from local governments due to tight budget.
由於預算緊張，地方政府的現金收款過程比預期的要慢。
Valuation
估價
We roll over and apply the same target multiple, 4x 24E P/E to derive the new TP of HK$9.09. With 91% upside, retain BUY rating.
我們將展期並應用相同的目標倍數，即4倍的24E市盈率，得出9.09港元的新目標價。上行空間爲91％，維持買入評級。
譯文內容由第三人軟體翻譯。