建筑装饰行业深度：Q3板块营收业绩持续承压，增量政策有望促Q4边际改善

Investment Rating - The report maintains an "Overweight" rating for the construction and decoration industry [1]. Core Viewpoints - The construction sector's revenue performance continues to be under pressure, with a 4.9% year-on-year decline in revenue for the first three quarters of 2024. However, incremental policies are expected to drive marginal improvements in Q4 [2][12]. - The overall net profit attributable to shareholders decreased by 11.9% year-on-year, with Q3 showing a decline of 15.4% [2][12]. - Recent government policies, including the acceleration of special bonds issuance, are anticipated to improve the funding situation for infrastructure projects, thereby enhancing the sector's fundamentals [2][13]. Summary by Sections Industry Overview - Q3 revenue performance remains under pressure, with a year-on-year decline of 8.0%. The decline is attributed to tight funding conditions and reduced capital contributions from state-owned enterprises [2][12]. - The gross profit margin for Q3 decreased to 9.80%, down 0.25 percentage points year-on-year, primarily due to a slowdown in revenue recognition and rigid cost expenditures [3][16]. - Operating cash flow showed signs of improvement, with a net inflow of 184 billion yuan in Q3, compared to a net outflow of 421 billion yuan in the same period last year [3][32]. Subsector Performance - In Q3, only three subsectors—power engineering, professional engineering, and chemical engineering—reported revenue growth, with increases of 13%, 11%, and 1% respectively [37]. - The decoration and design consulting sectors experienced the largest revenue declines, with decreases of 21% and 19% respectively [37][38]. - The professional engineering sector saw a significant profit increase of 82% in Q3, driven by improvements in specific fields such as geotechnical and cleanroom engineering [38]. Investment Recommendations - The report recommends focusing on undervalued state-owned enterprises such as China State Construction, China Communications Construction, and China Railway Construction, all of which have attractive price-to-book ratios and dividend yields [5]. - The anticipated implementation of large-scale debt restructuring and fiscal expansion policies is expected to gradually improve the funding situation in Q4, potentially reversing the sector's fundamentals [2][12].