Sinoma-int(SH:600970) ZHESHANG SECURITIES·2024-08-27 00:03Investment Rating - The investment rating for the company is "Buy" (maintained) [6] Core Views - The company achieved revenue and profit growth in the first half of 2024, with revenue reaching 20.9 billion yuan, a year-on-year increase of 1.7%, and a net profit of 1.4 billion yuan, up 2.3% year-on-year [2] - The operational maintenance business showed strong growth, contributing significantly to revenue, with a notable increase in new contracts signed [3] - The company is expected to benefit from the growth potential in cement engineering services along the Belt and Road Initiative, with a forecasted net profit of 3.3 billion yuan for 2024, corresponding to an EPS of 1.25 yuan per share [5] Summary by Sections Revenue and Profit Growth - In H1 2024, the company reported revenue of 20.9 billion yuan, a 1.7% increase year-on-year, and a net profit of 1.4 billion yuan, reflecting a 2.3% growth. The gross margin was 19.4%, up 1.0 percentage points, while the net margin remained stable at 7.1% [2] - Revenue from domestic and international markets was 11.4 billion yuan and 9.4 billion yuan, respectively, showing a decline of 7.2% domestically and an increase of 15.2% internationally [2] Operational Maintenance Business - The operational maintenance segment saw revenue contributions rise, with revenue from engineering technology services, high-end equipment manufacturing, and production operation services reaching 12.1 billion yuan, 2.92 billion yuan, and 5.67 billion yuan, respectively [3] - New contracts in the operational maintenance business increased significantly, particularly in mining and cement operations, indicating a robust growth trajectory [3] Financial Performance and Cash Flow - The company experienced an increase in foreign exchange losses due to overseas currency fluctuations, amounting to 220 million yuan, which was an increase of 160 million yuan year-on-year [4] - Operating cash flow improved significantly, with a net inflow of 890 million yuan, an increase of 1.83 billion yuan year-on-year, indicating a positive trend in cash management [4] Investment Outlook - The company is well-positioned for growth, supported by its strong parent company, China National Building Material Group, and the anticipated expansion of its equipment and operational maintenance businesses [5] - The forecast for the company's net profit in 2024 is 3.3 billion yuan, with an expected EPS of 1.25 yuan per share, maintaining a "Buy" rating [5]