CCA(603100) 诚通证券·2024-10-16 11:30Investment Rating - The report assigns a "Recommend" rating to Chuanyi Co Ltd (603100 SH) for the first time [1] Core Views - Chuanyi Co Ltd is a leading domestic intelligent instrumentation company, representing the trend of domestic substitution and self-reliance in China's manufacturing sector [1] - The company is well-positioned to benefit from the "deepening" phase of domestic substitution, which focuses on core components and supply chain security [1] - Chuanyi Co Ltd is a state-owned high-tech enterprise with strong fundamentals, multiple catalysts, and low valuation, making it a long-term investment opportunity [1] Company Overview - Chuanyi Co Ltd is the largest domestic industrial automation instrumentation and control device company, with the most comprehensive product portfolio and system integration capabilities [1] - The company's main revenue source is automation instrumentation, contributing 65 98 billion yuan in 2023, accounting for 89 0% of total revenue [1] - The company's products include high-precision intelligent pressure transmitters, electric actuators, intelligent control valves, and intelligent flow instruments, with continuous product upgrades and expanding product lines [1] Industry Overview - The industrial automation instrumentation and control device industry is the largest sub-sector of the instrumentation industry, with a domestic market size of 41 4 billion yuan, dominated by foreign brands [1] - The industry has significant growth potential, as evidenced by the success of global giants like Emerson, Honeywell, Siemens, and E+H [1] - The domestic substitution trend, driven by government policies and market demand, is expected to accelerate the development of the industry [1] Competitive Advantages - Chuanyi Co Ltd has a comprehensive product portfolio, covering almost all major categories of automation instrumentation, enabling it to provide industry-wide solutions [1] - The company has accumulated decades of R&D experience and manufacturing expertise, with a strong focus on technological innovation and market-driven R&D mechanisms [1] - The company has a deep industry moat due to its self-sufficient supply chain and core production tools, making it difficult for competitors to replicate [1] Catalysts - State-owned enterprise reform and the company's strong backing from the Chongqing State-owned Assets Supervision and Administration Commission provide a competitive edge [2] - Long-term capital expenditure growth in downstream process automation industries, such as petrochemicals, will support the company's growth [2] - The company is a key player in the domestic substitution of industrial instrumentation, with significant strategic importance for national economic security [2] Financial Projections - The report forecasts revenue of 8 039 billion yuan, 8 890 billion yuan, and 9 979 billion yuan for 2024, 2025, and 2026, respectively, with year-on-year growth rates of 8 48%, 10 58%, and 12 26% [3] - Net profit is expected to reach 803 million yuan, 919 million yuan, and 1 052 billion yuan for the same periods, with year-on-year growth rates of 7 96%, 14 39%, and 14 54% [3] - The company's PE ratio is projected to be 12 0X, 10 5X, and 9 2X for 2024, 2025, and 2026, respectively, indicating undervaluation compared to industry peers [3]