HUAXIN CEMENT(SH:600801) Soochow Securities·2024-09-02 05:00Investment Rating - The investment rating for the company is "Accumulate" (maintained) [1] Core Views - The company reported a total revenue of 16.24 billion yuan in the first half of 2024, a year-on-year increase of 2.6%, while the net profit attributable to shareholders was 731 million yuan, a year-on-year decrease of 38.7% [2][8] - Domestic cement demand is under increasing pressure, but aggregate and overseas cement sales continue to contribute positively [2][8] - The company’s cement and clinker sales reached 28.48 million tons in the first half, a decrease of 5% year-on-year, with domestic and overseas sales at 20.89 million tons and 7.60 million tons, respectively, reflecting a year-on-year decline of 16% and an increase of 41% [2][8] - The company is expanding its overseas operations, with new production lines in Mozambique and Malawi expected to add approximately 3 million tons of clinker capacity annually [2][8] - The gross margin for the first half was 23.7%, only a slight decrease of 0.7 percentage points year-on-year, supported by the higher contribution from aggregates and overseas cement [2][8] - The company’s financial expenses increased due to foreign exchange losses amounting to 115 million yuan [2][8] - The overall industry is experiencing significant losses, with over 50% of companies in the sector reporting losses, but there are signs of self-discipline and improvement in the industry [2][8] - The company has adjusted its net profit forecasts for 2024-2026 to 2.11 billion, 2.56 billion, and 2.80 billion yuan, respectively, reflecting a downward adjustment due to unexpected declines in domestic cement demand [2][8] Summary by Sections Revenue and Profit Forecast - Total revenue for 2024 is estimated at 35.09 billion yuan, with a year-on-year growth of 3.95% [2][8] - Net profit for 2024 is forecasted at 2.11 billion yuan, a decrease of 23.49% year-on-year [2][8] - The earnings per share (EPS) for 2024 is projected to be 1.02 yuan [2][8] Financial Metrics - The company’s total assets are projected to reach 71.89 billion yuan by 2024, with a debt-to-asset ratio of 51.18% [2][8] - The price-to-earnings (P/E) ratio is expected to be 10.53 for 2024 [2][8] Cash Flow and Capital Expenditure - The net cash flow from operating activities is expected to be 5.82 billion yuan in 2024 [9] - Capital expenditures are projected to be 6.63 billion yuan in 2024 [9]