SMHC(600131) Changjiang Securities·2024-11-18 02:36Investment Rating - The report maintains a "Buy" rating for the company [10][11]. Core Views - The company's revenue for the first three quarters of 2024 was 3.747 billion yuan, a year-on-year decrease of 4.89%, with a net profit attributable to the parent company of 298 million yuan, down 13% year-on-year [8][9]. - The decline in revenue for Q3 is attributed to a slower delivery pace in the digitalization sector of the power grid, but inventory levels at the end of Q3 increased by 40-50% compared to the previous quarter, indicating strong support for Q4 deliveries and revenue [9]. - The fourth batch of digitalization tenders from the State Grid has been released, with significant volumes in hardware and software, which is expected to support future orders and operations [10]. Summary by Sections Financial Performance - For Q3, the company achieved a revenue of 1.065 billion yuan, a year-on-year decrease of 4.38%, and a net profit of 66 million yuan, down 29.3% year-on-year [8][9]. - The gross profit margin for the first three quarters was 21.16%, an increase of 0.59 percentage points year-on-year, while the Q3 gross profit margin was 24.04%, slightly down by 1.13 percentage points [9]. - The operating expenses ratio for the first three quarters was 15.7%, up 1.8 percentage points year-on-year, with a Q3 ratio of 19.1%, an increase of 1.5 percentage points [9]. Market Outlook - The digitalization of the power grid is expected to see clearer development paths, with increasing demand for artificial intelligence and smart distribution networks, positioning the company favorably as a core construction unit under the State Grid [10]. - The estimated net profit for the company in 2024 is projected to be 900 million yuan, corresponding to a valuation of 31 times earnings [10].