ZAISHENG TECHNOLOGY(603601) 天风证券·2024-08-14 08:37Investment Rating - The report maintains a "Buy" rating for the company, with a target price of 3.30 CNY, reflecting a 1.5x price-to-book (PB) ratio for 2024 [4][6]. Core Views - The company experienced a decline in revenue and net profit in the first half of the year, with revenue of 7.51 million CNY and a net profit of 0.76 million CNY, down 8.67% and 6.3% year-on-year, respectively [1][2]. - Despite the overall decline, the high-efficiency energy-saving segment saw a revenue increase of 29.64%, driven by rising environmental protection demands both domestically and internationally [2]. - The company has made progress on its fundraising projects, with the first phase of the "8000 tons of clean air filter materials" project completed and operational, and other projects nearing completion [2]. Financial Performance - The gross profit margin for the first half of the year was 22.90%, a decrease of 1.22 percentage points year-on-year, while the second quarter saw a gross margin of 24.34%, reflecting a quarter-on-quarter increase of 3.18 percentage points [3]. - The company reported a net profit margin of 12.02% for Q2, which is an increase of 2.00 percentage points from the previous quarter [3]. - Operating cash flow for the first half of the year was 0.77 million CNY, an increase of 0.22 million CNY year-on-year, indicating good cash flow management [3]. Long-term Growth Potential - The demand for "clean air" and "high-efficiency energy-saving" products is expected to remain strong, suggesting promising long-term growth potential for the company [4]. - The company announced a high dividend payout ratio of 80% for 2023, with plans for a mid-year dividend distribution of 0.3 CNY per share, amounting to approximately 30.65 million CNY [4]. - The profit forecasts for 2024-2026 have been adjusted upwards to 1.5 million CNY, 1.8 million CNY, and 2.4 million CNY, respectively, reflecting improved performance expectations [4].