CSICL(SH:601989) ZHESHANG SECURITIES·2024-07-21 12:22Investment Rating - The report assigns a "Buy" rating for the company [2][4]. Core Viewpoints - The company is a leading shipbuilding enterprise under China Shipbuilding Group, benefiting from the rising shipbuilding industry and a transition in orders from container ships to oil and bulk carriers [1][2]. - The company is expected to see significant profit growth, with projected net profits of approximately 1.712 billion, 3.211 billion, and 5.168 billion yuan for 2024, 2025, and 2026 respectively, reflecting year-on-year growth rates of 88% and 61% in 2025 and 2026 [2][8]. - The shipbuilding industry is experiencing an upward cycle driven by replacement cycles, environmental policies, and tight capacity, which is expected to push ship prices to new highs [1][9]. Summary by Sections Company Overview - The company is a core shipbuilding platform under China Shipbuilding Group, focusing on marine defense, marine development equipment, and marine transportation equipment, with shipbuilding and repair accounting for about 70% of its revenue [15][24]. - Major subsidiaries include Dalian Shipbuilding, Wuchang Shipbuilding, and Beihai Shipbuilding, which are recognized modern shipbuilding enterprises [24][30]. Industry Analysis - The shipbuilding industry is experiencing a demand surge, with new orders for oil tankers and bulk carriers expected to increase significantly due to tight supply and high prices [1][9]. - The report highlights that the company is well-positioned to benefit from the ongoing demand for large oil tankers and bulk carriers, with a significant backlog of orders [1][2]. Financial Forecast and Valuation - Revenue projections for 2024, 2025, and 2026 are approximately 59.468 billion, 59.749 billion, and 75.553 billion yuan, with year-on-year growth rates of 27%, 0%, and 26% respectively [3][8]. - The company is expected to achieve a price-to-earnings ratio (P/E) of 71, 38, and 24 for the years 2024, 2025, and 2026, respectively, indicating a favorable valuation outlook [2][8].