Jereh Group(SZ:002353) Soochow Securities·2024-10-25 08:00Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The company reported a 2% increase in net profit attributable to shareholders for the first three quarters of 2024, indicating an upcoming performance inflection point [2] - The company achieved total revenue of 8.05 billion yuan in the first three quarters, a year-on-year decrease of 8%, while net profit attributable to shareholders was 1.6 billion yuan, reflecting a 2% increase [2] - The increase in profit growth outpaced revenue growth due to a higher proportion of overseas and equipment orders, enhancing profitability [2] - The company has significantly increased its contract liabilities to 1.49 billion yuan, up 99% from the beginning of the year, indicating a backlog of high-profit orders waiting to be released [2] - The gross profit margin for the first three quarters was 35.0%, up 1.51 percentage points year-on-year, while the net profit margin was 20.5%, up 2.2 percentage points [2] - The company is deepening its cooperation in the "Belt and Road" initiative, with significant contracts signed in the Middle East, showcasing its capabilities in high-end oil service projects [2] - The company is committed to advancing its globalization strategy by establishing a manufacturing base in the Middle East, which will enhance its production and service capabilities in the region [2] - The company is considered a high-quality target in the machinery sector with low valuation and confirmed growth potential, maintaining profit forecasts of 2.7 billion, 3.3 billion, and 3.7 billion yuan for 2024-2026 [2] Financial Summary - Total revenue forecast for 2024 is 14.42 billion yuan, with a year-on-year growth of 3.64% [1] - Net profit attributable to shareholders is projected to be 2.725 billion yuan in 2024, reflecting an 11.02% year-on-year increase [1] - The company’s earnings per share (EPS) is expected to be 2.66 yuan in 2024, with a price-to-earnings (P/E) ratio of 12.06 based on the current price [1]