Keda Group(SH:600499) Minsheng Securities·2024-08-22 02:38Investment Rating - The report maintains a "Recommended" rating for the company with a current price of 6.72 CNY [2] Core Views - The company reported a revenue of 5.494 billion CNY for the first half of 2024, a year-on-year increase of 15.74%, while the net profit attributable to the parent company was 454 million CNY, a decrease of 64.16% [2] - The construction machinery segment saw a revenue of 2.705 billion CNY, up 28.97% year-on-year, with an overseas order ratio exceeding 60% [3] - The overseas building materials segment generated 1.984 billion CNY in revenue, a 4.02% increase year-on-year, with a gross margin of 30.95% [4] - The company is expanding its production capacity and product categories in Africa and the Americas, despite facing short-term profitability pressures due to structural competition and currency fluctuations [4][5] - The lithium battery segment, where the company holds a 43.58% stake in Blue Lithium Industry, reported a revenue of 1.685 billion CNY, but profits were impacted by falling lithium prices and increased costs [8] Summary by Sections Financial Performance - In H1 2024, the company achieved a gross margin of 25.63%, down 6.13 percentage points year-on-year, and a net margin of 10.09%, down 25.81 percentage points [2] - The Q2 2024 gross margin was 24.57% with a net margin of 5.00% [2] Construction Machinery - The construction machinery business is experiencing global and diversified growth, with significant orders from Southeast Asia, the Middle East, Europe, and South Asia [3] - The company has established 13 production bases in regions including Foshan, Italy, and India, covering over 60 countries [3] Overseas Building Materials - The overseas building materials segment is expanding with production bases in six African countries and two in the Americas, with ongoing construction of additional production lines [4] - The company anticipates a recovery in profitability in the second half of 2024 as prices for tiles in key markets like Kenya and Tanzania have begun to rise [4] Currency Impact - Currency fluctuations have affected financial performance, with a reported financial expense of 146 million CNY in H1 2024, including a foreign exchange loss of 63 million CNY [5] - The report highlights varying currency trends in countries where the company operates, impacting overall financial results [5][7] Lithium Segment - The lithium segment's revenue was 1.685 billion CNY, with a production volume of approximately 18,900 tons of lithium carbonate, reflecting over 30% growth year-on-year [8] - The net profit contribution from Blue Lithium Industry to the company was 138 million CNY, a decrease of 716 million CNY compared to the previous year [8] Future Outlook - The company is expected to achieve net profits of 1.21 billion CNY, 1.34 billion CNY, and 1.51 billion CNY for 2024, 2025, and 2026 respectively, with corresponding PE ratios of 11, 10, and 9 [8][10]