Incident: The company released its 2023 annual report. For the full year of 2023, the company achieved total operating income of 27.859 billion yuan, -9.39% year on year; realized net profit to mother of 372 million yuan, -89.22% year on year; gross profit margin of 11.20%, -8.79 pct year on year; achieved a net sales margin of 1.36%, -9.86pct year on year.
Cash dividends have soared to strengthen shareholder returns: In 2023, the company plans to distribute a cash dividend of 3.0410 yuan (tax included) to all shareholders for every 10 shares. The company's current total share capital is 2.27 billion shares, and a total cash dividend of 656 million yuan (tax included) is proposed. Cash dividends for the year accounted for 176.25% of net profit attributable to shareholders of the parent company.
Continue to promote larger and lighter fans: In 2023, the company achieved 9.69 GW of fan sales, up 32.66% year on year; corresponding sales of fans and related accessories reached 23.517 billion yuan, up 3.11% year on year; gross profit margin on sales of fans and related accessories was 6.35%, a year-on-year decrease of 11.42 percentage points. Among them, fans above 6.VMW sold 12.25 billion yuan, an increase of 37.02% over the previous year. In 2023, 779 fans above 6.XMW were produced, an increase of 141.18% over the previous year. Benefiting from technological innovation to increase the capacity and weight of stand-alone fans, wind power costs continue to decline.
Develop new energy power plants on a rolling basis to enhance profitability: in 2023, the company achieved a total operating revenue of 1,499 billion yuan, an increase of 12.24% over the previous year; the gross margin of the power plant operation business was 63.00%, an increase of 3.12 percentage points over the previous year; and the average number of hours of power generation in operation by the company was 1,568 hours. By the end of 2023, the installed capacity of the company's operating new energy power plants was 2.56 GW, an increase of 70.47% over the same period last year; the installed capacity under construction was 3.30 GW, a year-on-year decrease of 3.49%; the total power generation capacity of the new energy power plants in operation by the company was 4,016 billion kilowatt-hours, an increase of 40.46% over the previous year.
Investment proposal: We expect the company to achieve operating income of 376.10/432.51/47.576 billion yuan in 2024-2026, and net profit to mother of 24.27/29.65/38.60 billion yuan. The corresponding PE was 9.18/7.52/5.77 times, respectively, maintaining the “gain” rating.
Risk warning: Production expansion falls short of expectations; prices of upstream raw materials fluctuate; downstream demand falls short of expectations.