AVIC SAC(600760) 国金证券·2024-10-31 09:30Investment Rating - The investment rating for the company is "Buy" (maintained) [3][27]. Core Views - The company's performance is under pressure due to the progress of contract signing, with expectations for recovery in equipment construction prosperity [4][5]. - The company is a leading player in the domestic aerospace defense equipment sector, with a complete model spectrum that establishes competitive advantages. The recovery of aerospace equipment prosperity and the upcoming release of new models are expected to open growth opportunities in military trade and maintenance [6]. Summary by Sections Performance Analysis - In the first three quarters of 2024, the company achieved revenue of 25.298 billion RMB, a year-on-year decrease of 27%, and a net profit attributable to shareholders of 1.818 billion RMB, down 23.1%. In Q3 alone, revenue was 3.673 billion RMB, down 68% year-on-year and 69.7% quarter-on-quarter, with a net profit of 199 million RMB, down 77.1% year-on-year and 77.9% quarter-on-quarter. The primary reason for this decline is the impact of contract signing progress, as the expected demand for related products has not been realized [4][5][13]. - As of the end of Q3 2024, the company's contract liabilities amounted to 5.814 billion RMB, an increase of 2.862 billion RMB from the end of Q2 2024, reflecting a growth rate of 96.94%, likely due to the issuance of some orders [5][19]. Profitability and Cost Analysis - The gross profit margin for the first three quarters of 2024 was 12.5%, an increase of 1.6 percentage points year-on-year, while the net profit margin was 7.2%, up 0.4 percentage points year-on-year. In Q3, the gross profit margin was 12.2%, up 0.5 percentage points year-on-year but down 0.7 percentage points quarter-on-quarter, with a net profit margin of 5.4%, down 2.2 percentage points year-on-year and 2 percentage points quarter-on-quarter [5][14]. - The company experienced a significant increase in inventory, with a balance of 11.489 billion RMB at the end of Q3, up 4.268 billion RMB from the end of Q2, reflecting a growth rate of 59.11%, likely due to the impact of the delivery schedule of products [5][19]. Construction and Expansion - The company's construction in progress increased to 1.457 billion RMB at the end of Q3, up 36.09% from the end of Q2. The company is actively advancing capacity construction in anticipation of a new round of product mass deliveries, which is expected to initiate a new phase of high growth [6][17]. Profit Forecast and Valuation - The company is projected to achieve net profits attributable to shareholders of 3.78 billion RMB, 4.695 billion RMB, and 5.808 billion RMB for the years 2024, 2025, and 2026, respectively, representing year-on-year growth rates of 25.7%, 24.2%, and 23.7%. The corresponding price-to-earnings ratios are expected to be 34, 28, and 22 times [6][8].