Jereh Group(SZ:002353) Guoyuan Securities·2024-09-05 09:00Investment Rating - The report maintains a "Buy" rating for the company, indicating an expected stock price increase of over 15% compared to the benchmark index [11]. Core Views - The company's revenue for the first half of 2024 was CNY 4.957 billion, a year-on-year decrease of 8.54%, while the net profit attributable to shareholders was CNY 1.088 billion, a year-on-year increase of 4.33% [2]. - The company secured new orders worth CNY 7.179 billion in the first half of 2024, representing an 18.92% increase year-on-year, with a total order backlog of CNY 9.191 billion by the end of the first half [2]. - The gross margin for the first half of 2024 was 35.83%, an increase of 0.15 percentage points year-on-year, while the net profit margin was 21.95%, up by 2.71 percentage points year-on-year [2]. Financial Performance Summary - Revenue for Q1 and Q2 of 2024 was CNY 2.131 billion and CNY 2.826 billion, respectively, with year-on-year declines of 6.52% and 10.01% [2]. - The company’s revenue from oil and gas services and equipment was CNY 4.163 billion, showing a slight increase of 0.01%, while revenue from oil and gas engineering and equipment dropped by 36.86% to CNY 0.794 billion [2]. - The company’s R&D expense ratio was 4.09%, reflecting a year-on-year increase of 0.86 percentage points, indicating a stable investment in innovation [2]. Growth and Market Strategy - The company is actively pursuing a global development strategy, having signed a preliminary development contract for the Mansuriya project with the Central Oil Company of Iraq in May 2024 [2]. - In March 2024, the company invested USD 120 million to enhance its Middle East subsidiary's capacity, establishing a high-end oil and gas equipment manufacturing base in Dubai [2]. - The company is expected to achieve revenues of CNY 14.757 billion, CNY 17.048 billion, and CNY 19.256 billion for the years 2024, 2025, and 2026, respectively, with net profits projected at CNY 2.767 billion, CNY 3.234 billion, and CNY 3.758 billion [3].