2024-08-01 11:00Investment Rating - The report maintains a "Recommended" rating for the company [2][3]. Core Views - The company signed contracts worth 459.9 billion yuan in June and July 2024, exceeding expectations, particularly in the area of high-level maintenance for EMUs (Electric Multiple Units) [1]. - The cumulative orders for high-level maintenance of EMUs reached 285 billion yuan in 2024, significantly surpassing last year's total of 73 billion yuan and nearing the 2019 figure of 313 billion yuan [1]. - The company is expected to see an increase in annual delivery volumes, enhancing earnings flexibility due to anticipated public tenders for EMU maintenance in the second half of the year [1]. - The high proportion of maintenance business is expected to stabilize the company's operations, with a projected market space exceeding 30 billion yuan annually for high-level maintenance over the next three years [1]. Financial Projections - The company is projected to achieve net profits of 14.504 billion yuan, 16.497 billion yuan, and 18.335 billion yuan for the years 2024, 2025, and 2026 respectively, with corresponding EPS of 0.51, 0.57, and 0.64 yuan [2][6]. - Revenue is expected to grow from 234.261 billion yuan in 2023 to 269.799 billion yuan in 2024, reflecting a growth rate of 15.17% [6][9]. - The gross margin is projected to improve slightly from 22.27% in 2023 to 22.44% in 2024 [9][10]. Business Segments - The company's railway equipment, urban rail, and new industry segments reported gross margins of 25.27%, 21.29%, and 19.14% respectively, with EMU maintenance showing higher profitability compared to other vehicle types [1]. - The maintenance business, which constitutes nearly 40% of the railway equipment segment, is expected to grow in proportion as demand for EMU high-level maintenance increases [1].