Guangzhou Metro Design & Research Institute (SZ:003013) Guotou Securities·2024-07-04 09:00Investment Rating - The report assigns a "Buy - A" rating to the company, with a target price of 18.9 CNY over the next six months [90]. Core Viewpoints - The company is a high-barrier state-owned enterprise in urban rail design, demonstrating robust operational resilience and strong investment value with high ROE [1][90]. - The company has maintained positive revenue and net profit growth from 2016 to 2023, with a CAGR of 12.76% for revenue and 17.11% for net profit during this period [1][101]. - The company is well-positioned to benefit from the ongoing urban rail construction plans in China, particularly in key regions like the Guangdong-Hong Kong-Macao Greater Bay Area [87][173]. Summary by Sections 1. Company Overview - The company, Guangzhou Metro Design Institute Co., Ltd., is a leading player in the urban rail design sector, with a comprehensive design capability covering various fields including urban rail, municipal, and architectural design [124][125]. - It has the highest qualifications in the industry, including dual first-class qualifications in urban planning and engineering design [125]. 2. Financial Performance - The company reported a revenue of 25.73 billion CNY in 2023, reflecting a year-on-year growth of 3.92% [1][101]. - The net profit for the same year was 4.32 billion CNY, with an increase of 8.01% year-on-year [1][101]. - The average dividend payout ratio since its listing in 2020 has been 50.67%, indicating strong long-term investment returns [13]. 3. Growth Drivers - The company is expanding its business horizontally and vertically, leveraging its strong shareholder support and exploring new business areas such as smart rail transit and low-altitude economy [116][118]. - The company has a significant market share in Guangdong and is actively pursuing projects in other provinces and overseas [115][116]. 4. Industry Analysis - The urban rail design market in China is characterized by high barriers to entry and a clear competitive landscape, with a concentration of major players [142][143]. - The demand for urban rail construction is expected to remain strong, supported by government policies and infrastructure investment plans [173][174]. 5. Profitability and Valuation - The company has consistently maintained a high level of profitability, with a net profit margin of 17.08% in 2023, significantly higher than the industry average [60][180]. - The projected revenue for 2024-2026 is expected to grow to 28.52 billion CNY, 31.26 billion CNY, and 34.28 billion CNY, respectively, with corresponding net profits of 4.83 billion CNY, 5.35 billion CNY, and 5.79 billion CNY [118][119].