Investment Rating - The investment rating for China State Construction International (3311.HK) is "Buy" and is maintained [3]. Core Views - The Hong Kong government has introduced mandatory measures for construction sites with budgets exceeding 30 million HKD to adopt the Smart Site Safety System (4S), which is expected to enhance safety management in the construction industry [4]. - The market potential for smart construction sites in Hong Kong is estimated to be around 600 million HKD per year, driven by the government's push for safety and innovation in construction [4]. - China State Construction International's subsidiary, Haihong Technology Co., Ltd., is positioned as a leading provider of the 4S system, having developed its C-SMART system with competitive pricing and practical applications tailored to the construction industry [5]. Summary by Sections Event Description - On May 20, 2024, the Hong Kong Development Bureau and the Construction Industry Association launched the 4S labeling program to improve construction site safety management. Starting July 1, 2024, all construction contracts exceeding 30 million HKD must implement the 4S system [4]. Market Opportunity - The CITF (Construction Industry Innovation and Technology Fund) has increased its funding limits to encourage the adoption of the 4S system in private projects, with a significant portion of the funding allocated for purchasing or leasing the system [4]. - The estimated market size for smart construction in Hong Kong is approximately 600 million HKD annually, based on the adoption of CITF's standardized product packages [4]. Company Advantages - China State Construction International's C-SMART system has evolved significantly, offering competitive pricing that is 10%-20% lower than CITF packages, and is better suited for practical use in construction environments [5]. - The company is well-positioned to leverage its experience in Hong Kong to expand into mainland markets, where there is increasing governmental support for smart construction initiatives [5].

Investment Rating - The report assigns a "Buy" rating to the company with a target price of HKD 12.31 per share, based on a 6x PE for 2024 [2][3]. Core Insights - The company is a leading player in the Hong Kong and Macau construction industry, with rapid growth in performance. From 2019 to 2023, revenue increased from HKD 61.8 billion to HKD 113.7 billion, representing a CAGR of +16.5%, while net profit rose from HKD 5.41 billion to HKD 9.16 billion, with a CAGR of +14.1% [2][3]. - The company's strong market position in Hong Kong and Macau is driven by the deep integration of the Guangdong-Hong Kong-Macau Greater Bay Area. In Hong Kong, revenue grew from HKD 21.4 billion in 2019 to HKD 30.8 billion in 2023, with a CAGR of +10%, while in Macau, revenue surged from HKD 4.7 billion to HKD 10.8 billion, achieving a CAGR of +23% [3][4]. - The company's mainland operations are driven by technology and investment, with a significant improvement in cash flow. The return on equity (ROE) increased from 11.8% in 2018 to 13.9% in 2022, and technology-driven orders accounted for 32.1% of new contracts in 2022, growing by 70.6% year-on-year [3][4]. Summary by Sections Section 1: Company Overview - The company, established in 1979 and listed in 2005, operates a comprehensive business model covering technology, investment, construction, and asset management. It is one of the largest general contractors in Hong Kong and a leading urban investment operator in mainland China [10][11]. Section 2: Business Performance - The company's core business includes infrastructure investment and construction, with significant contributions from prefabricated construction and curtain wall engineering. In 2023, infrastructure investment accounted for 55.9% of revenue, while construction engineering contributed 35.4% [18][19]. Section 3: Financial Performance - The company achieved a revenue of HKD 113.7 billion in 2023, reflecting an 11.4% year-on-year increase. The net profit for the same year was HKD 9.16 billion, up 15.2% year-on-year. The CAGR for revenue and net profit from 2019 to 2023 was +16.5% and +14.1%, respectively [23][24]. Section 4: Future Outlook - The company expects net profits for 2024, 2025, and 2026 to be HKD 10.3 billion, HKD 11.7 billion, and HKD 13.5 billion, respectively, with year-on-year growth rates of +12.8%, +13.5%, and +14.9% [3][4].

Investment Rating - The report initiates coverage with a "Buy" rating for China State Construction International (03311.HK) [2] Core Views - China State Construction International is positioned as a leading player in the Hong Kong and Macau engineering sector, benefiting from the integration of the Greater Bay Area and the adoption of MiC technology for accelerated growth [1][6] - The company has shown resilience in maintaining steady growth despite macroeconomic disruptions and a downturn in the real estate sector, with a revenue and profit CAGR of 15% and 13% respectively from 2013 to 2023 [1][15] - The shift towards short-cycle investment projects, particularly GTR, has improved the company's cash flow and return on equity (ROE), which increased to 15.3% in 2023 [1][6] - The demand for modular construction (MiC) is expected to grow significantly, with government mandates in Hong Kong and mainland China driving adoption [1][6] - The ongoing push for affordable housing in China is projected to accelerate construction, with an estimated investment of 639.5 billion in 2024, benefiting the company's operations [1][6] - The integration of the Guangdong-Hong Kong-Macau Greater Bay Area is expected to enhance infrastructure demand, with significant investments planned for the region [1][6] Summary by Sections Company Overview - China State Construction International is the only Hong Kong and Macau engineering platform under China State Construction Group, having entered the mainland market in 2008 and focusing on investment projects [1][10] - The company has established a comprehensive business model integrating technology, investment, construction, and asset management, with operations in over 80 cities across 22 provinces [10][12] Business Structure - The company's revenue is primarily derived from mainland China, contributing 58% of total revenue in 2023, with government clients accounting for over 80% of its business [12][14] - The business segments include construction projects in housing and infrastructure, with a significant focus on investment-type projects [12][14] Financial Performance - The company has demonstrated robust financial performance, with a revenue of 113.7 billion HKD in 2023, reflecting an 11.5% year-on-year growth [4][16] - The gross margin for 2023 was reported at 14.4%, significantly higher than its peers, driven by the higher margin from investment projects in mainland China [16] Investment Strategy - The company has optimized its investment strategy by focusing on short-cycle projects, which has led to improved cash flow and a notable increase in ROE [1][6] - The MiC technology has positioned the company as a leader in prefabricated construction, with a market share of 40% in technology-driven projects [1][6] Policy Environment - The Chinese government's commitment to affordable housing is expected to drive significant investment in the sector, with a target of constructing 9 million affordable housing units during the 14th Five-Year Plan [1][6] - The integration of the Greater Bay Area is anticipated to create substantial infrastructure development opportunities, with projected investments of 675.8 billion HKD in 2023 [1][6]

Investment Rating - The report maintains a "Buy" rating for China State Construction International (03311 HK) with a target price of HKD 15.00 [1][2]. Core Insights - In Q1 2024, the operating profit increased by 15.1% year-on-year to HKD 3.91 billion, with new contracts signed rising by 69.6% to HKD 80.09 billion [1]. - The company forecasts earnings per share of HKD 2.028, HKD 2.266, and HKD 2.503 for 2024, 2025, and 2026 respectively, maintaining a target price that corresponds to EV/EBITDA multiples of 7.2x, 7.1x, and 6.9x for the same years [1]. - The total value of contracts on hand as of March 31, 2024, was HKD 394.95 billion, reflecting a year-on-year increase of 24.0% [1]. Summary by Sections Financial Performance - Q1 2024 revenue reached HKD 24.17 billion, marking an 11.7% year-on-year increase [1]. - The operating profit for the same period was HKD 3.91 billion, up 15.1% year-on-year [1]. Contractual Developments - New contracts signed in Q1 2024 totaled HKD 80.09 billion, a significant increase of 69.6% year-on-year [1]. - The company, in partnership with Veolia Group, won the New Territories West Landfill Extension project, valued at HKD 61.1 billion, which is the largest single contract in the company's history [2]. Future Outlook - The company aims to secure new contracts worth no less than HKD 210 billion in 2024, representing an 11.7% year-on-year growth target [1].

Financial Performance - The company's revenue for the year reached HKD 113,734,013, an increase of 11.5% compared to HKD 101,975,265 in the previous year[12]. - The profit attributable to shareholders was HKD 9,164,045, representing a growth of 15.1% from HKD 7,956,876 in the prior year[12]. - The EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) for the year was HKD 16,027,295, up 11.6% from HKD 14,362,945 in the previous year[12]. - The company reported a net profit margin of 8.1%, a decrease from 7.8% in the previous year[12]. - The earnings per share (EPS) increased to HKD 1.82, compared to HKD 1.58 in the previous year, reflecting a growth of 15.2%[12]. - The company declared a final dividend of HKD 0.56 per share, up from HKD 0.48 per share in the previous year[12]. - The current ratio improved to 1.28, compared to 1.25 in the previous year, indicating better short-term financial health[12]. - The group's audited revenue for the year ended December 31, 2023, was HKD 113.734 billion, with an operating profit of HKD 14.986 billion[29]. - Shareholder profit increased by 15.2% to HKD 9.164 billion, with basic earnings per share at HKD 1.82 and net asset value per share at HKD 14.74[29]. - Investment income, other income, and net other gains/losses decreased by 59.0% to HKD 647 million, primarily due to reduced fair value gains from investment properties and no confirmed gains from the sale of investments during the year[46]. Contracts and Projects - The total uncompleted contracts amounted to HKD 350.05 billion, an increase from HKD 294.53 billion at the end of the previous year[12]. - The group undertook 121 new projects during the year, with a total contract value of approximately HKD 188.02 billion[28]. - New contracts signed in Hong Kong reached HKD 70.921 billion, a significant increase of 58.0% year-on-year[30]. - New contracts in Macau amounted to HKD 9.541 billion, maintaining the market leadership position[30]. - New contracts in mainland China totaled HKD 96.055 billion, reflecting a year-on-year growth of 4.5%[31]. - The total contract amount attributable to the company reached HKD 571.94 billion[57]. - As of December 31, 2023, the total contract amount for ongoing projects is HKD 571,944 million, with an uncompleted contract amount of HKD 350,051 million[60]. - The company has 338 ongoing projects, including 221 in mainland China, 78 in Hong Kong, and 39 in Macau[60]. - Major completed projects include the reconstruction of Kwong Wah Hospital and various residential developments in Hong Kong[38]. - The company is involved in significant civil engineering projects, such as the Tseung Kwan O to Lam Tin Tunnel and the construction of the West Kowloon Terminus for the Express Rail Link[38]. Technological Innovation and R&D - The company invested HKD 486 million in R&D, continuing to progress towards the goals set in the 14th Five-Year Plan[37]. - The company plans to continue focusing on technological innovation and digital transformation as key strategic directions for future growth[40]. - The company was awarded 211 patents during the year, reflecting its strong technological capabilities and innovation[37]. - The group launched new photovoltaic curtain wall products, Light A and Mega Light A, and completed the first production line for photovoltaic curtain walls[32]. - The group’s modular integrated construction technology was showcased at the 20th China International Housing Industry and Building Industrialization Products and Equipment Expo[20]. Awards and Recognition - The company received multiple awards for its projects, including 13 gold awards and 10 silver awards at the 2022 Construction Industry Safety Award Ceremony in Macau[13]. - The group was recognized as one of the top 40 companies in China for ESG influence by Fortune magazine due to its outstanding performance in the ESG field[18]. - The group was selected as a constituent of the Hang Seng Corporate Sustainability Benchmark Index for its exceptional performance in sustainable development[22]. - The group received 15 awards at the 29th Public Works Site Award Ceremony, becoming the company with the most awards in the industry for two consecutive sessions[24]. - The group was the only construction and engineering company included in the S&P Global Sustainable Development Yearbook 2023, receiving the title of "Best Progressing Company in the Industry"[21]. Corporate Governance and Management - Management emphasized the importance of investor relations, viewing it as a key area to enhance corporate governance and value creation, with significant support from the management team[91]. - The company has a strong commitment to corporate governance, adhering to the Hong Kong Stock Exchange's corporate governance code[108]. - The board of directors held six meetings during the year to review and approve the company's annual, interim, and quarterly performance[113]. - The chairman and CEO roles are clearly separated to ensure a balanced distribution of power and authority within the company[116]. - The company has implemented a sustainable development policy, including water resource management and climate change policies[113]. - The board consists of seven directors, with six male and one female, reflecting a gender diversity commitment[78]. Social Responsibility and Community Engagement - The group organized over 1,400 hours of volunteer service through the "Co-create Bright Teen" program, helping students from underprivileged backgrounds[86]. - The group completed home repairs for over 620 households under the "Thousand House Repairs" initiative, targeting low-income families[88]. - The group has established a volunteer service system that engaged over 4,700 volunteer instances, contributing more than 17,000 hours of service in 2023[87]. - The company actively engages in community support and social responsibility initiatives[78]. - The company has received the 2023 Hong Kong Volunteer Award for corporate volunteer hours[72]. Financial Instruments and Capital Management - The group issued bonds amounting to RMB 1.1 billion with a maturity of 3 years and a coupon rate of 2.88%, receiving AAA ratings and the highest G1 level green certification[22]. - The group actively utilized green financial instruments, securing a USD 100 million sustainable development-linked loan in Hong Kong[35]. - The group completed a public offering that raised approximately RMB 3.067 billion, which was used for debt repayment and general working capital[155]. - The group has issued corporate bonds of RMB 1 billion at a coupon rate of 2.88% for a term of 3 years on August 21, 2023[155]. - The group redeemed corporate bonds of RMB 2 billion at a coupon rate of 3.48% that were issued on July 30, 2020[156]. Risk Management - The company has a robust risk management and internal control system, effectively managing strategic, financial, operational, compliance, and sustainability risks[137]. - The risk management team, led by the CEO, continuously identifies and enhances the company's risk management practices, fostering a culture of comprehensive risk awareness[138]. - The audit department conducts independent evaluations of the risk management and internal control systems, ensuring their adequacy and effectiveness across all major operational units[138]. - The company has established a detailed project risk rating system to identify and assess major operational risks, ensuring that operational risks remain within controllable limits[147]. - The company faces various risks, including construction risks, infrastructure investment risks, overseas business risks, and compliance risks, which are managed through a structured internal control framework[147].

Revenue Performance - For the three months ended March 31, 2024, the group's unaudited revenue was approximately HKD 24,165,906,000, representing an increase from HKD 21,639,304,000 for the same period in 2023, which is a growth of about 11.6%[3] Operating Profit - The group's unaudited operating profit for the same period was approximately HKD 3,911,940,000, compared to HKD 3,398,564,000 in 2023, reflecting an increase of approximately 15.1%[3] Contractual Obligations - The total new contracts signed by the group for the three months ended March 31, 2024, amounted to approximately HKD 80.09 billion[4] - As of March 31, 2024, the group's uncompleted contract amount was approximately HKD 394.95 billion[4] Financial Data Disclaimer - The financial data provided is unaudited and should not be considered as an indication of the group's financial performance for the three months ended March 31, 2024[6]

hcraeseR 股 票 研 [Table_Title] Gary Wong 黄家玮 ytiuqE Company Report: China State Construction International (03311 HK) 究 (852) 2509 2616 公司报告： 中国建筑国际 (03311 HK) 中文版 Chinese version gary.wong@gtjas.com.hk 25 March 2024 科[Ta技ble带_Su动mm类ar业y] 务贡献将不断增加  我们重申“买入”评级，维持15.00港元的目标价。我们分别小幅下调中国建筑 [RTaabtlien_gR:a nk] Buy 国际（“公司”）2024/2025年每股盈利预测3.4%/ 3.1%至2.028港元/2.266港 公 Maintained tropeR 元，并首次给予2026年每股盈利预测为2.503港元。我们维持15.00港元的 司 目标价，相当于7.2倍/ 7.1倍/ 6.9倍的2024/ 2025/ 2026年EV/EBITDA。 评级： 买入 (维持) 报 ynapmoC  2023年股东净利润同比增 ...

%% research.95579.com %% 丨证券研究报告丨 港股研究丨公司点评丨中国建筑国际（ ） 3311.HK [Table_Title] 利润与现金流齐飞，港澳高景气兑现在即 报告要点 [中Ta国bl建e_筑Su国m际m发ar布y] 2023年年报，实现营业 1137.34亿港元，同增 11.5%；毛利率较2022年 13.7%升至14.4%；归母净利润91.64亿港元，同增15.2%。 ...

香港交易及結算所有限公司及香港聯合交易所有限公司對本公告的內容概不負責，對其準確性或完整性亦不發 表任何聲明，並明確表示，概不對因本公告全部或任何部分內容而產生或因依賴該等內容而引致的任何損失承 擔任何責任。 (於開曼群島註冊成立之有限公司) (股份代號 : 3311) 截至二零二三年十二月三十一日止年度之 業績公告、 末期股息及暫停辦理股份過戶登記手續 財務摘要 二零二三年 二零二二年 變動 % 業績 (港幣千元) 營業額 113,734,013 101,975,265 11.5 毛利率 14.4% 13.7% 0.7 本公司股東應佔溢利 9,164,045 7,956,876 15.2 每股財務資料 盈利 – 基本 (港元) 1.82 1.58 15.2 ...

%% research.95579.com %% ...