Jangho(601886) 海通证券·2024-09-03 00:39Investment Rating - The investment rating for the company is "Outperform" and is maintained [1] Core Views - The company achieved revenue of RMB 9.92 billion in H1 2024, a YoY increase of 12.10%, with net profit attributable to shareholders of RMB 322 million, up 10.23% YoY [5] - In H1 2024, the company secured new construction decoration orders totaling RMB 12.884 billion, maintaining its leading position in the industry [5] - The company's overseas revenue grew significantly, with a 23.61% YoY increase in overseas markets, driven by expansion in the Middle East, Australia, and the Americas [5][6] - The company's BIPV (Building Integrated Photovoltaics) business saw rapid growth, with revenue from photovoltaic construction projects reaching RMB 314 million, a 124% YoY increase [6] - The company's gross margin improved by 0.65 pct to 15.63% in H1 2024, while the net margin increased slightly by 0.02 pct to 3.92% [6] Financial Performance and Forecast - The company's revenue is expected to grow by 10.6% YoY in 2024E, reaching RMB 23.175 billion, with net profit projected to increase by 10.0% YoY to RMB 739 million [7] - The company's EPS is forecasted to be RMB 0.65 in 2024E, increasing to RMB 0.72 in 2025E [7] - The company's ROE (Return on Equity) is expected to rise from 9.5% in 2023 to 9.6% in 2024E, with further growth to 9.7% in 2025E [7] - The company's operating cash flow improved significantly in Q2 2024, with a net inflow of RMB 516 million, a YoY increase of RMB 717 million [6] Industry and Market Position - The company remains the leader in the construction decoration industry, with new orders in H1 2024 totaling RMB 12.884 billion, a 14.22% YoY increase [5] - The company's BIPV business is gaining market recognition, with external orders for photovoltaic components increasing, indicating strong growth potential in the green building sector [6] - The company's overseas business is expanding, with a focus on the Middle East, Australia, and the Americas, contributing to a 23.61% YoY increase in overseas revenue [5][6] Valuation and Target Price - The company's fair value is estimated to be in the range of RMB 6.52-7.82, based on a 2024E PE ratio of 10-12x [6] - The company's current PE ratio is 7.52x for 2023, expected to decrease to 6.84x in 2024E and further to 6.21x in 2025E [9] - The company's PB ratio is 0.71x for 2023, projected to decline to 0.66x in 2024E and 0.60x in 2025E [9]