CCCCDC(SH:600720) HTSC·2025-03-28 03:34Investment Rating - The report maintains a "Buy" rating for the company with a target price of 11.88 RMB [7][8]. Core Views - The company's revenue for 2024 is projected at 12.434 billion RMB, a decrease of 7.98% year-on-year, while the net profit attributable to the parent company is expected to be 1.751 billion RMB, down 0.84% year-on-year [1][4]. - The company is expected to benefit from increased central government investment in major projects and the development of new infrastructure such as low-altitude airspace, AI, smart transportation, and smart cities [1]. - The company is accelerating its globalization efforts, with overseas new orders signed in 2024 increasing by 81.6% year-on-year, which is anticipated to contribute positively to future growth [2]. Summary by Sections Financial Performance - In 2024, the company achieved a revenue of 12.434 billion RMB and a net profit of 1.751 billion RMB, with a comprehensive gross margin of 29.4%, an increase of 2.23 percentage points year-on-year [2][4]. - The revenue breakdown shows that surveying and design, engineering contracting, project management, and engineering testing achieved revenues of 9.32 billion, 1.96 billion, 460 million, and 310 million RMB respectively, with varying year-on-year changes [2]. Cost Management - The company has improved its comprehensive gross margin through business structure optimization and strengthened cost control, with gross margins for different segments showing positive year-on-year changes [2]. Cash Flow and Receivables - The company experienced a significant increase in impairment losses, which rose to 474 million RMB, primarily due to a 29 billion RMB increase in accounts receivable [3]. - Operating cash flow for 2024 was negative at -306 million RMB, reflecting challenges in cash collection due to extended payment cycles from clients [3]. Profit Forecast and Valuation - The forecast for net profit attributable to the parent company for 2025-2027 is adjusted to 1.817 billion, 1.928 billion, and 2.031 billion RMB respectively, with a target price based on a 15x PE ratio for 2025 [4][6]. - The company is positioned as an industry leader with significant global presence and advantages in scale and high-end services, justifying the valuation premium [4].