PCI-STCL(600728) ZHESHANG SECURITIES·2024-11-24 08:23Investment Rating - The report maintains a "Buy" rating for the company with a target price of 7.95 yuan, representing a 44% upside from the current price [7][9] Core Investment Thesis - Guangzhou's new transportation blueprint, aiming to triple the metro mileage by 2035, is expected to drive the company's performance beyond expectations [2] - The company, as a leader in the rail transit sector, is well-positioned to benefit from Guangzhou's metro expansion, potentially adding nearly 1 billion yuan in annual profit [3] Key Drivers Driver 1: Incremental Metro Line Electromechanical Construction - Guangzhou plans to add 39 new metro lines totaling 1,350 km by 2035, with an estimated 135 billion yuan in electromechanical construction investment over 10 years [4] - Assuming a 60% market share and 8% net margin, this could contribute 650 million yuan in annual profit [4] Driver 2: Metro Station Operation Business Growth - Post-operation, metro station maintenance and government subsidies will drive demand for station operation services [5] - With 931 stations expected by 2035 and a 70% market share, this could add 320 million yuan in annual profit [5] Profit Forecast and Valuation - Revenue is projected to grow from 7.1 billion yuan in 2024 to 10.116 billion yuan in 2026 [7] - Net profit is expected to increase from 63 million yuan in 2024 to 504 million yuan in 2026 [7] - The company is valued at 34X PE for 2026, with a target market cap of 17 billion yuan [7] Industry Context - Guangzhou's metro expansion is part of a broader urban rail transit growth trend, with national metro mileage tripling from 2015 to 2023 [3] - The company's expertise in rail transit systems and AI-driven solutions positions it well to capitalize on this growth [30][33] Catalysts - Release of detailed Guangzhou metro planning guidelines [6] - New metro contract signings exceeding expectations [6]