SUMEC(SH:600710) Tai Ping Yang·2024-06-17 09:30Investment Rating - The report assigns an "Accumulate" rating to the company, indicating a positive outlook for the stock's performance in the near term [1][17]. Core Insights - The company achieved total revenue of 122.98 billion in 2023, a decrease of 12.87% year-on-year, while net profit attributable to shareholders was 1.03 billion, an increase of 12.4% year-on-year [8]. - The earnings per share for 2023 was 0.79, with a return on equity of 15.75%. A cash dividend of 0.33 per share was declared, resulting in a dividend yield of 3.75% based on the closing price on April 12 [8]. - For Q1 2024, the company reported total revenue of 23.745 billion, a decline of 23.4% year-on-year, but net profit attributable to shareholders increased by 5.2% to 266 million [8]. - The company is primarily engaged in supply chain integration services and various product and service offerings, with a significant shareholding by China National Machinery Industry Corporation at 41.6% [8]. Financial Projections - Revenue projections for the upcoming years are as follows: 2024E at 115.42 billion, 2025E at 113.65 billion, and 2026E at 115.11 billion, indicating a gradual recovery after a decline [9]. - Net profit is expected to grow from 1.11 billion in 2024E to 1.33 billion in 2026E, reflecting a compound annual growth rate of 23.5% over three years [17]. - The diluted earnings per share are projected to increase from 0.85 in 2024E to 1.02 in 2026E, with a decreasing price-to-earnings ratio from 9.80 in 2024E to 8.17 in 2026E [9].