DEC(600875) 华源证券·2024-09-01 08:02Investment Rating - Buy (Maintained) [3] Core Views - The company's performance was below expectations due to a decline in gross margin, a drop in investment income, and an increase in R&D expenses [3] - The power equipment sector continues to grow, but the trade sector has contracted significantly [3] - Newly effective orders have grown significantly, indicating potential for future revenue growth, especially in coal power and hydropower [4] - The company's profitability is expected to continue growing under the dual carbon targets, with coal power, gas power, nuclear power, and pumped storage all contributing to performance [4] Financial Performance - H1 2024 revenue: 33.457 billion yuan, up 11.84% YoY [3] - H1 2024 net profit: 1.691 billion yuan, down 15.52% YoY [3] - Q2 2024 revenue: 18.404 billion yuan, up 21.09% YoY [3] - Q2 2024 net profit: 786 million yuan, down 20.04% YoY [3] - H1 2024 gross margin: down 2.07pct YoY [3] - H1 2024 R&D expense ratio: 4.06%, up 0.36pct YoY [3] Sector Performance - Wind power revenue: 6.66 billion yuan, up 19.14% YoY [3] - Hydropower revenue: 1.296 billion yuan, up 21.48% YoY [3] - Nuclear power revenue: 1.936 billion yuan, up 60.43% YoY [3] - Gas turbine revenue: 3.607 billion yuan, up 154.17% YoY [3] - Coal power revenue: 8.522 billion yuan, up 15.99% YoY [3] - Trade sector revenue: 1.767 billion yuan, down 61.31% YoY [3] Order Growth - Newly effective orders Jan-Jun 2024: 56.073 billion yuan, up 14.8% YoY [4] - Newly effective orders Jan-Jul 2024: 62.783 billion yuan, up 19.2% YoY [4] - Coal power order growth: over 28% Jan-Jun, over 37% Jan-Jul [4] - Hydropower order growth: over 70% Jan-Jun, over 102% Jan-Jul [4] Valuation and Forecast - 2024-2026 net profit forecast adjusted to 3.62, 4.88, and 5.45 billion yuan [4] - 2024-2026 PE ratios: 11x, 8x, and 7x [4] - 2024-2026 revenue growth forecast: 10.02%, 9.17%, and 4.97% [6] - 2024-2026 net profit growth forecast: 1.87%, 34.85%, and 11.74% [6] Key Financial Metrics - Closing price: 13.56 yuan [5] - Market cap: 40.429 billion yuan [5] - Total assets: 131.57 billion yuan [5] - Debt-to-asset ratio: 68.49% [5] - Net assets: 41.461 billion yuan [5] - PB ratio: 1.14 [5]