IMDTECL(SZ:002128) Guotai Junan Securities·2024-10-25 10:11Investment Rating - The report assigns an "Accumulate" rating to the company, with a target price of 25.70, up from the previous target of 18.78 [5][10]. Core Insights - The company's Q3 performance showed significant year-on-year and quarter-on-quarter growth, primarily driven by increased coal production and sales. However, profitability in the electrolytic aluminum business is expected to decline [3][10]. - The company is positioned as a pioneer in coal enterprise transformation, with green electricity business expected to become a new growth point for performance [3][10]. Summary by Sections Financial Performance - For the first three quarters of 2024, the company achieved revenue of 21.81 billion, a 10.54% increase year-on-year, and a net profit attributable to shareholders of 4.40 billion, up 22.73% [10]. - In Q3 alone, revenue reached 7.683 billion, representing a year-on-year increase of 17.81% and a quarter-on-quarter increase of 13.28%. The net profit for Q3 was 1.455 billion, up 45.26% year-on-year and 45.55% quarter-on-quarter [10]. Production and Sales - The increase in revenue is attributed to higher coal production and sales, with over 90% of coal sold under long-term contracts, leading to stable coal prices. The company reported a coal production capacity of 48 million tons for H1 2024, an increase of 2 million tons year-on-year [10]. - Q3 operating costs were 5.091 billion, up 11.72% year-on-year and 8.69% quarter-on-quarter, indicating that the cost increase was less than revenue growth, primarily due to increased production and sales [10]. Business Segments - The electrolytic aluminum business is expected to see a decline in profitability, with Q3 earnings from this segment estimated at 134 million, down 1.20 billion from Q2. The average aluminum price decreased by 975 yuan/ton, while the cost of alumina increased by 277 yuan/ton [10]. - The company has invested in renewable energy, with 4.78 GW of installed capacity and significant growth in electricity generation and sales, which are expected to contribute to future performance [10]. Financial Projections - The report raises the earnings per share (EPS) forecast for 2024 and 2025 to 2.57 and 2.65 yuan, respectively, with a new EPS estimate for 2026 at 2.72 yuan. The dividend payout ratio is projected at 33%, resulting in a dividend yield of 4.2% [10][11].