GUOTONG PP(SH:600444) Guoyuan Securities·2024-09-27 13:03Investment Rating - The report initiates coverage with a "Buy" rating for the company [20]. Core Views - The company, backed by Hefei General Machinery Research Institute, is a leading enterprise in fluid machinery technology, with a broad layout that opens up significant growth potential [2][10]. - The main revenue sources include environmental engineering and system integration, refrigeration testing equipment, and non-standard fluid machinery products and services, which accounted for 39.3%, 20.1%, and 21.3% of total revenue in 2023, respectively [2][10]. - The company is expected to enhance its profitability in the short term and maintain a positive long-term growth trend, driven by the divestment of its plastic pipe business and entry into emerging markets [20]. Summary by Sections Company Overview - The company operates in two main sectors: fluid machinery and pipe materials, with a focus on environmental engineering and refrigeration testing equipment [2][10]. - The company is gradually exiting the plastic pipe business as part of its strategic optimization [2][10]. Revenue and Profitability - In 2023, the company's revenue reached 7.55 billion yuan, with a compound annual growth rate (CAGR) of 2.52% from 2020 to 2023 [11]. - The gross margins for refrigeration testing equipment and non-standard fluid machinery products were 24.6% and 21.3%, respectively, indicating strong profitability in these segments [2][10]. Financial Forecast - Revenue projections for 2024, 2025, and 2026 are 7.57 billion yuan, 8.48 billion yuan, and 9.55 billion yuan, representing year-on-year growth of 0.21%, 12.08%, and 12.58% [20]. - The net profit attributable to shareholders is forecasted to be 440 million yuan, 560 million yuan, and 630 million yuan for the same years, with growth rates of 10.33%, 27.56%, and 11.15% [20]. Market Position and Opportunities - The company has established itself as a pioneer in refrigeration technology and engineering, achieving international advanced levels in its products [2][10]. - The company is well-positioned to capture new business opportunities in the lithium battery recycling market, leveraging its comprehensive technology in filtration and separation equipment [17][20].