CRRC(601766) Shanxi Securities·2024-08-31 05:07Investment Rating - The report assigns a "Buy-A" rating for the company, indicating a positive outlook for investment [1][3]. Core Views - The company is entering a new growth phase in its rail transit equipment business, driven by increased demand for new purchases and maintenance services [1][3]. - The company's revenue has rebounded, surpassing 2019 levels, with a reported revenue of 234.26 billion yuan in 2023, reflecting a year-on-year growth of 5.08% [1][25]. - The dual-track and dual-cluster strategy is showing initial success, with the rail transit business recovering significantly [1][3]. Summary by Sections 1. Global Rail Transit Leader, Steady Progress in New Industries - The company has established a dual-track strategy focusing on rail transit equipment and clean energy equipment, leading to a cluster development model [12][17]. - The company has a stable shareholding structure, with strong capabilities in its subsidiaries [17][20]. - New industries are growing steadily, effectively smoothing out the performance cycles of the rail transit business [23][30]. 2. Strong Demand for New Purchases and Maintenance in the EMU Business - The demand for new EMUs is strong, with significant growth in maintenance contracts as vehicles enter their major repair cycles [39][40]. - The company is benefiting from policies promoting the replacement of old diesel locomotives with new energy locomotives, leading to an increase in both volume and price [39][40]. - The rail freight and passenger transport metrics are reaching new highs, supporting capital expenditures [1][39]. 3. Overseas Market Potential and Belt and Road Initiative Contributions - The global rail transit equipment market is expected to see differentiated demand, with significant opportunities in regions like Southeast Asia and Africa [1][3]. - The company has successfully participated in key projects like the Jakarta-Bandung High-Speed Rail, showcasing its capabilities [1][3]. 4. Profit Forecast and Valuation Analysis - The company is projected to achieve net profits of 131.4 billion yuan, 146.6 billion yuan, and 158.4 billion yuan for 2024, 2025, and 2026 respectively, with year-on-year growth rates of 12.2%, 11.5%, and 8.1% [3][4]. - The price-to-earnings ratio is expected to be 15.9, 14.2, and 13.2 for the same years, indicating a favorable valuation [3][4].