Slow growth in mid-2023. In 2023, the company achieved operating income of about 1,542 billion yuan, up 5.96% year on year, EBTIDA about 1,051 million yuan, up 2.83% year on year, and net profit to mother about 123 million yuan, up 4.65 percent year on year. In the fourth quarter of 2023, the company's revenue increased significantly, but net profit declined significantly. The main reason was that the company had one-time revenue in the fourth quarter, but there was an increase in depreciation due to asset impairment and the transformation of a data center under construction.
By the end of 2023, the company operated a total of 35 data centers in the Beijing-Tianjin-Hebei, Yangtze River Delta, the eastern hub of the Guangdong-Hong Kong-Macao Greater Bay Area and corresponding core regions in the west. The IT megawatts reached 371 megawatts, which translates to about 74,200 standard 5 kilowatt cabinets, which can support 20 billion computations per second for major customers. Currently, most of the company's high-density cabinets (8 kilowatts) are conducive to AI business development, especially data centers in the north, without large-scale transformation of the refrigeration system.
Industry demand is still weak, and it is expected that the company will continue to grow at a medium to low rate in the future. Judging from industry demand in 2024, it is still at a low point where supply exceeds demand. The industry's growth rate is slow due to insufficient demand from large cloud computing and Internet companies, so the company's new project construction is also slowing down. At present, the civil construction of the Langfang project has basically been completed. The project is in progress, and the Shanghai and Huailai projects are still in the early stages. Considering that the company has 24+ agreements with major customers, it is expected that full electricity will be billed this year. We believe that the company's revenue will naturally grow at a slow rate in the next three years, and the net profit margin will be between 8% and 10%.
Investment advice. We forecast that the company's revenue for 2024-2026 will be 16.50 (+0.9%)/17.33 (-5.4%)/RMB 1,819 billion, respectively. The 2024-2026 EBITDA was 10.86 (-7.5%)/12.00 (-8.5%)/1.24 billion yuan, respectively. Considering that the sentiment in the industry still shows no signs of an inflection point, we have lowered our revenue growth rate for 25-26 years. The company is currently in the top three overall rankings in the industry (the ranking of the Chinese Academy of Information and Communications Technology in '23), and its profitability is stable. Referring to the average value of comparable companies and industry sentiment, we gave Data Port 11 times EV/EBITDA in 2024 (originally 13 times), the corresponding target market value was RMB 10.298 billion, and the target price was RMB 22.36 per share (-14.8%), maintaining a “superior to market” rating.
Risk warning. The diversified development of the company fell short of expectations, and the demand side of a single major customer slowed down further, affecting the company's EBITDA; the company's new project customer development fell short of expectations, affecting future revenue growth