CSCEC(601668) 国泰君安·2024-10-29 11:13Investment Rating - The investment rating for China State Construction Engineering Corporation is "Buy" [3]. Core Views - The report indicates that the company's Q3 performance was below expectations due to ongoing adjustments in the real estate market and a slowdown in infrastructure investment. However, it is anticipated that with the implementation of incremental fiscal policies, the company will leverage its competitive advantages to achieve sustained growth [4][5]. Financial Summary - For the first three quarters of 2024, the company reported revenue of 1.63 trillion yuan, a decrease of 2.67% year-on-year. The net profit attributable to shareholders was 39.7 billion yuan, down 9.05% year-on-year [5]. - The operating cash flow showed significant improvement, with a net cash flow of -77 billion yuan for the first three quarters of 2024, compared to -16.4 billion yuan in the same period of 2023 [5]. - The company’s gross profit margin for the first three quarters was 8.83%, a slight decrease of 0.1 percentage points [5]. Earnings Forecast - The earnings per share (EPS) estimates for 2024, 2025, and 2026 have been revised down to 1.24 yuan, 1.28 yuan, and 1.32 yuan respectively, reflecting a decrease of 5%, 3%, and 3% from previous forecasts [5]. - The target price remains at 7.76 yuan, corresponding to a price-to-earnings (PE) ratio of 6.3 times for 2024 [5]. Order Growth - New signed contracts increased by 4.7% year-on-year to 32.48 billion yuan in the first three quarters of 2024, with significant growth in energy engineering and water environmental projects [5][13]. - The breakdown of new contracts shows that the construction of residential buildings decreased by 9.9%, while industrial plant contracts increased by 26.4% [13]. Shareholder Confidence - The controlling shareholder's recent increase in holdings demonstrates confidence in the company's future performance, with a current dividend yield of 4.4% and a price-to-book (PB) ratio of 0.57, indicating potential value for investors [5].