Guangshen Railway(SH:601333) Changjiang Securities·2024-11-04 07:22Investment Rating - The investment rating for the company is "Buy" and is maintained [4]. Core Views - The company is continuously advancing its transformation into high-speed rail operations, with the introduction of cross-line high-speed trains leading to increased line and vehicle leasing costs, while also reducing the utilization rate of these resources. The new cross-port sleeper trains have similar cost implications, and their revenue levels are expected to take time to improve, potentially dragging down short-term profitability. In Q3 2024, the company achieved operating revenue of 7.105 billion yuan, a year-on-year increase of 4.5%, while the net profit attributable to shareholders was 297 million yuan, a year-on-year decrease of 13.0% [4][5][6]. Summary by Sections Financial Performance - In Q3 2024, the company reported operating revenue of 7.105 billion yuan, up 4.5% year-on-year, and a net profit of 297 million yuan, down 13.0% year-on-year. Cumulatively, for the first three quarters, the operating revenue reached 20.030 billion yuan, an increase of 4.4%, while the net profit was 1.209 billion yuan, up 18.7% [4][5]. Operational Changes - The company has opened new cross-line trains, which have resulted in a decrease in passenger flow for its intercity and long-distance trains compared to 2019, with declines of 35.7% and 2.8% respectively. However, operating revenue increased by 30.9% to 7.105 billion yuan, indicating a shift towards more cross-line passenger services [4][6]. Future Outlook - The company is transitioning from being a resource provider to an operator in the high-speed rail sector. The report anticipates that the company's net profits for 2024 to 2026 will be 1.31 billion, 1.51 billion, and 1.68 billion yuan respectively, with corresponding price-to-earnings ratios of 18.2, 15.9, and 14.2 [6][15].