HASCO(SH:600741) Haitong Securities·2024-10-31 00:51Investment Rating - The investment rating for the company is "Outperform the Market" and is maintained [1] Core Views - The company has shown significant progress in neutralization, with continuous improvement in revenue structure. For the first three quarters of 2024, the company achieved revenue of 119.49 billion yuan, a year-on-year decrease of 2%, and a net profit attributable to shareholders of 4.47 billion yuan, a year-on-year decrease of 6% [4][5] - In Q3 2024, the company reported revenue of 42.20 billion yuan, down 5% year-on-year but up 5% quarter-on-quarter, with a net profit of 1.61 billion yuan, down 15% year-on-year but up 1% quarter-on-quarter [4][5] - The gross margin for Q3 2024 was 12.3%, an increase of 0.01 percentage points year-on-year and 0.6 percentage points quarter-on-quarter, while the net profit margin was 4.3%, down 0.4 percentage points year-on-year and quarter-on-quarter [4][5] Revenue and Profit Forecast - The company is expected to achieve revenues of 172 billion yuan, 178.1 billion yuan, and 184.4 billion yuan for the years 2024, 2025, and 2026 respectively, with net profits of 6.16 billion yuan, 6.78 billion yuan, and 7.34 billion yuan for the same years [6][10] - The earnings per share (EPS) are projected to be 1.95 yuan, 2.15 yuan, and 2.33 yuan for 2024, 2025, and 2026 respectively [6][10] Financial Performance - The company’s total revenue for 2023 is estimated at 168.59 billion yuan, with a year-on-year growth of 6.5%, and a projected net profit of 7.21 billion yuan, showing a minimal growth of 0.2% [7][10] - The gross margin is expected to decline slightly from 13.3% in 2023 to 12.5% in 2024, and remain stable at around 12.4% for the following years [10][11] Market Comparison - The company’s stock price as of October 30, 2024, corresponds to a price-to-earnings (P/E) ratio of approximately 8.1 for 2024, 7.4 for 2025, and 6.8 for 2026, indicating a stable operational outlook [6][10] - The reasonable P/E range for the company in 2024 is estimated to be between 9 and 10 times, corresponding to a fair value range of 17.59 to 19.55 yuan per share [6][10]