NARI-TECH(600406) 长江证券·2024-09-11 01:39Investment Rating - The report maintains a "Buy" rating for the company, with a target PE of 25X for 2024 [6][7] Core Views - The company reported H1 2024 revenue of RMB 20.1 billion, up 10% YoY, and net profit attributable to shareholders of RMB 2.7 billion, up 8% YoY [1][4] - Q2 2024 revenue was RMB 12.4 billion, up 3% YoY, with net profit attributable to shareholders of RMB 2.1 billion, up 7% YoY [1][4] - The company is expected to accelerate growth in H2 2024, driven by faster delivery of ultra-high voltage projects and increased orders [6] Business Performance Revenue Breakdown - Smart Grid revenue: RMB 9.4 billion, up 2% YoY, with growth in substation and power consumption automation [5] - Digital Energy Integration revenue: RMB 3.7 billion, up 15% YoY, reflecting strong demand for grid digitalization [5] - Low-Carbon Energy revenue: RMB 5.1 billion, up 33% YoY, driven by traditional power and new energy generation demand [5] - Industrial Internet revenue: RMB 1.2 billion, up 6% YoY [5] - Integration and other revenue: RMB 0.7 billion, down 14% YoY, as the company gradually scales back this segment [5] Profitability - H1 2024 gross margin: 29%, up 0.5 pct YoY, with Q2 gross margin at 31.7%, up 2.4 pct YoY [5] - Smart Grid gross margin improved by 2.6 pct YoY, driven by product mix optimization and cost reduction [5] - Low-Carbon Energy gross margin increased by 1.7 pct YoY, supported by higher-margin products like thermal power equipment [5] - Q2 2024 net profit margin improved, with profit growth outpacing revenue growth [5] Orders and International Expansion - New contracts in H1 2024: RMB 28.7 billion, up 11% YoY [5] - Overseas revenue: RMB 831 million, up 92.8% YoY, with projects secured in Saudi Arabia, Pakistan, and Brazil [5] - The company won the operation and maintenance contract for Saudi Arabia's ADMS system [5] Financial Forecasts - 2024E revenue: RMB 58 billion, with net profit attributable to shareholders of RMB 8 billion [12] - 2025E revenue: RMB 65.3 billion, with net profit attributable to shareholders of RMB 9.1 billion [12] - 2026E revenue: RMB 71.8 billion, with net profit attributable to shareholders of RMB 10.1 billion [12] Shareholder Returns - The company plans to distribute a cash dividend of RMB 0.135 per share (tax included) for the interim period [5]