Jereh Group(SZ:002353) Great Wall Securities·2024-09-03 08:21Investment Rating - The report maintains a "Buy" rating for the company, indicating an expected stock price increase of over 15% relative to the industry index within the next six months [11]. Core Views - The company's profitability is improving, with overseas orders contributing to performance momentum. The company has signed new orders worth 7.179 billion yuan, an increase of 18.92% year-on-year, and has a backlog of 9.191 billion yuan as of June [1][2]. - The company is actively pursuing a globalization strategy, enhancing its market competitiveness through various initiatives, including significant investments in high-end oil and gas equipment manufacturing bases in the Middle East and partnerships in energy projects [2][6]. - The oil and gas industry is experiencing a recovery, supported by national policies encouraging exploration efforts, which bodes well for the company's product demand [2][6]. Financial Summary - For the first half of 2024, the company reported revenue of 4.957 billion yuan, a year-on-year decrease of 8.54%, while net profit attributable to shareholders was 1.088 billion yuan, an increase of 4.33% [1]. - The company’s revenue is projected to grow from 13.912 billion yuan in 2023 to 14.538 billion yuan in 2024, with a compound annual growth rate of 4.5% [1][7]. - The net profit attributable to shareholders is expected to increase from 2.454 billion yuan in 2023 to 2.704 billion yuan in 2024, reflecting a year-on-year growth of 10.2% [1][7]. Research and Development - The company invested 203 million yuan in R&D in the first half of 2024, a year-on-year increase of 15.68%, focusing on innovative products that enhance its competitive edge [6]. - New product developments include a next-generation integrated fracturing truck and advanced hazardous waste treatment equipment, which significantly improve operational efficiency and environmental sustainability [6]. Market Position - The company achieved overseas revenue of 2.381 billion yuan in the first half of 2024, accounting for 48.04% of total revenue, with a gross margin of 37.19% [2][6]. - The average price of Brent crude oil was 83.42 USD per barrel in the first half of 2024, indicating a year-on-year increase of 4.56%, which supports the overall recovery of the oil and gas sector [2].