China XD(SH:601179) SINOLINK SECURITIES·2025-04-15 01:40Investment Rating - The report maintains a "Buy" rating for the company, expecting significant profit growth in the coming years [5]. Core Insights - The company reported a revenue of 22.28 billion RMB for 2024, a year-on-year increase of 5.1%, and a net profit attributable to shareholders of 1.05 billion RMB, up 17.5% year-on-year [2]. - The first quarter of 2025 saw revenues of 5.26 billion RMB, representing a 10.9% year-on-year growth, with a net profit of 290 million RMB, up 42.1% year-on-year, indicating better-than-expected performance [2]. - The company holds a leading position in the domestic market, with a 9.3% share in the State Grid's power transmission and transformation projects and a 20.4% share in ultra-high voltage projects [3]. - The company has expanded its international business, with new contracts signed in Turkey, Italy, and Sweden, increasing the export share of equipment to over 50% [3]. Revenue and Profitability Analysis - The transformer segment achieved a revenue of 9.22 billion RMB in 2024, up 17.8% year-on-year, with a gross margin of 14.4%, an increase of 5.9 percentage points [4]. - The switch segment generated 8.5 billion RMB in revenue, a year-on-year increase of 11.0%, with a gross margin of 26.5%, up 1.3 percentage points [4]. - The capacitor and lightning arrester segment reported a revenue of 980 million RMB, up 22.6% year-on-year, with a gross margin of 23.2%, an increase of 1.5 percentage points [4]. - The company’s operating cash flow improved significantly, reaching 3.5 billion RMB in 2024, a year-on-year increase of 176.6% [4]. Future Projections - The company is expected to achieve net profits of 1.58 billion RMB, 2.02 billion RMB, and 2.49 billion RMB for the years 2025, 2026, and 2027, respectively, reflecting growth rates of 50%, 28%, and 23% [5]. - The projected P/E ratios for the upcoming years are 21, 16, and 13 times for 2025, 2026, and 2027, respectively [5].